What to Do When Insurance Won't Pay a Claim
There is just one real reason to buy insurance: to receive compensation after you suffer a loss. Therefore, if your insurance company denies your claim after a loss, you may feel frustrated and cheated, as if you bought the policy for no reason at all. There are some actions you can take to understand the denial better, and maybe even reverse the insurer's decision.
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Read Your Policy
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The best time to get familiar with your insurance policy is before you have to file a claim, so you're aware of what is and isn't available to you. Every insurance contract contains a list of exclusions, or things it simply will not pay for. If you filed a claim for an excluded type of loss, your insurer denied your claim because your policy was never intended to provide benefits in that circumstance. If your loss is excluded by your policy, no action you take will reverse the insurer's decision.
Request Denial in Writing
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If you remain confused as to why your claim was denied even after you review your policy, ask your insurance adjuster to provide details of the denial in writing, including references to any policy language that excludes the benefits you seek. This way, the insurer spells out exactly why it chose not to provide you with benefits, and you can spend your time and effort arguing the actual issue at hand, rather than creating irrelevant arguments and rebuttals.
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Craft Your Argument
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Insurance companies make decisions based on facts and statistics. The best way to sway the opinion of your insurer is to use its own language. If you were denied a medical treatment, provide evidence from your doctor or scientific studies showing that the treatment is medically necessary. If you did not receive a proper value for your automobile, provide comparable vehicle sales listings supporting why you believe your car's value is higher than the insurer says it is. Whatever claim you make, be ready to provide supporting documentation to justify your demands.
Speak to a Supervisor
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Supervisors and managers often have more authority than adjusters when it comes to claims decisions. Your adjuster's supervisor can review your claim and your adjuster's decisions to see if there are any errors. Send all supporting documentation to the supervisor and request confirmation in writing that he received it. Follow up with periodic phone calls to state your case, argue your point and learn the outcome of his review. If necessary, request to speak to the supervisor's manager. Be polite, but be persistent.
External Assistance
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When all else fails, you can hire an attorney or contact your state's department of insurance for assistance. Be careful when you exercise these options. A department of insurance complaint is often effective, but it will strain your relationship with your adjuster, and the insurer may be less likely to work with you reasonably afterward. Similarly, an attorney's involvement often limits the communication you can have with your adjuster directly, so you may be left out of the settlement process as a result.
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References
- American Cancer Society: Handling a Claim Denial -- What to Do When Insurance Won`t Pay for a Prescribed Service
- WATE Knoxville, Tennessee; What to Do When Your Insurance Company Won't Pay; Ryan C. Fuhrmann; March, 2011
- Insure; Home Insurance Exclusions; January, 2011
- Car Insurance Comparison: How Do I Win a Car Insurance Claim Suit?
- Photo Credit Jupiterimages/Polka Dot/Getty Images
