Dealing with a denied personal injury claim can be frustrating, especially when you’re counting on the compensation to cover your medical bills and other expenses.
Insurance companies use various tactics to minimize or deny claims, leaving claimants feeling helpless. Whether it’s disputing liability, questioning the severity of injuries, or citing policy exclusions, it can be intimidating to challenge these denials.
Understanding the common reasons behind claim denials and knowing how to effectively appeal the insurance company’s decision is crucial for obtaining the financial support you need.
If you're up against a denied claim, don’t try to dispute it alone. Schedule a free consultation with an experienced Las Vegas personal injury lawyer today to discuss your case and get professional assistance pursuing the compensation you deserve.
Why Do Insurance Companies Deny Claims?
Insurance companies may deny claims for many reasons, most of which are aimed at minimizing their payout obligations.
For instance, imagine a homeowner who files a claim after a severe storm has damaged their roof. Even though the homeowner’s insurance covers storm damage, the insurer might deny the claim, arguing that the damage was due to “wear and tear” or poor maintenance rather than the storm itself. This lets them avoid paying for the repairs by citing policy exclusions.
These types of denials can be aggravating, especially when the damage is clearly a result of the covered event.
Insurance providers might also use other tactics to deny claims, such as arguing that the claim was filed too late, the paperwork was incomplete, or there isn’t sufficient proof that the event caused the damage.
It’s important to understand why claims are typically denied so you can be better prepared to counter these sorts of tactics. That means keeping detailed records, taking lots of photos, and gathering any other evidence that supports your claim.
Problems with Insurance Coverage
Issues with the coverage details on an insurance policy can create significant hurdles when filing a claim. Insurance companies meticulously review the policy details to find any possible reason to deny or limit the claim. Here are some of the reasons they might come up with:
Driver Exclusion Clauses
Let’s say you get into a car accident while on someone else’s auto insurance policy, and the insurance adjuster discovers a driver exclusion clause on the policy. (This clause specifies that only certain drivers are covered.) If you aren’t explicitly named on the policy, the insurance company may refuse to cover the damage.
Lapsed Coverage
Another common issue arises when a policy has lapsed. Coverage can lapse for various reasons, such as missing premium payments or the policy being canceled without the policyholder’s knowledge. In such cases, even if the claim is legitimate, the insurance company refuses it simply because the policy wasn't active at the time of the incident.
Insufficient Coverage Limits
Insufficient coverage can also be grounds for denial. Imagine you suffer a serious injury at a local business, but the owner only has minimal liability coverage that doesn't fully cover your medical expenses. In this case, the insurance company will only pay up to the policy limits, leaving you responsible for the remaining amount.
Policy Exclusions
Lastly, certain exclusions within a policy can lead to claim denials. If your property is damaged by flooding but your insurance policy specifically excludes flood damage, your insurer won’t cover the loss.
Understanding the specific terms and limitations of your policy is critical, as it will help you anticipate potential issues and seek appropriate legal or professional advice when filing a claim.
What Are Bad Faith Insurance Practices?
Bad faith insurance practices occur when an insurance company fails to uphold its obligation to handle valid claims fairly and in good faith. These practices can take many forms, all of which are intended to minimize payouts or avoid them altogether, regardless of the legitimacy of the claim.
Examples of bad faith insurance practices include:
Denying Claims Without Proper Investigation
An insurer might deny a claim without conducting a thorough investigation, simply rejecting it based on minimal or irrelevant information. This lack of due diligence is a clear indicator of bad faith, as the adjuster isn’t genuinely evaluating the validity of the claim.
Unnecessary Delays
Another common tactic is needlessly delaying the claims process, dragging it out to pressure the policyholder into accepting a lower settlement. Such delays can cause significant stress and financial hardship for the claimant, who may feel compelled to settle for less than what they’re entitled to.
Misrepresenting Policy Terms
Some insurers may even misrepresent the terms of the policy, falsely claiming that certain damages or injuries aren’t covered when, in fact, they are. This deceitful behavior is intended to discourage claimants from pursuing their rightful compensation and is a blatant violation of their duty to act in good faith.
The actions described here are meant to wear down claimants and make it difficult for them to receive the compensation they deserve. If you suspect you’re being subjected to such practices, consult a qualified attorney. They can help you hold the insurance company accountable for their unacceptable conduct.
Liability and Fault Disputes
Disputes regarding liability and fault often arise when insurance companies attempt to avoid paying personal injury claims by questioning who was responsible for the accident.
Instead of focusing on coverage issues, they may quibble over certain circumstances of the incident to shift blame away from the policyholder, such as the following:
Contesting the Cause of the Injury
The insurer may try to claim that your injuries weren’t a result of the accident in question but instead stem from a pre-existing condition or a previous incident. Without sufficient evidence to prove that your injuries are directly related to the accident, they may deny your claim.
To counter this tactic, it’s vital to provide comprehensive documentation, such as medical records and witness statements, that clearly link your injuries to the event.
Disputing the Severity of Injuries
Your insurer may also question the nature or extent of your injuries, possibly going so far as to suggest that you’re exaggerating your condition. They might argue that the kind of accident you experienced couldn’t have caused the level of harm you’re claiming.
In such cases, detailed medical evaluations and expert opinions will be indispensable for substantiating the severity of your injuries and ensuring that you receive fair compensation.
Pointing to Lack of Clear Evidence of Fault
The insurer adjuster might argue that you were partially or entirely responsible for the accident, which could have a major impact on the outcome of your claim. If there’s any indication that you contributed to the incident, the insurance company may use it as a pretext to deny or reduce your compensation.
Once again, it’s crucial to gather as much compelling evidence as possible — including photos, video footage, and police reports — to demonstrate the other party’s liability.
Suggesting That Multiple Parties Are at Fault
Insurance companies often leverage the involvement of multiple parties to deny claims. If they can show that more than one person contributed to the accident, they might successfully argue that their policyholder isn’t solely liable.
In states like Nevada where modified comparative negligence laws apply, this can complicate the claims process or result in inadequate awards. An experienced personal injury lawyer can help resolve these disputes, ensuring that liability is properly assigned.
How to Appeal an Insurance Company Decision
If you've experienced an insurance claim denial, you can take the following steps to challenge the decision:
Review the Denial Letter
Start by carefully reading the denial letter. It should explain the reason for the rejection and provide specific instructions on how to file an appeal. It’s important to understand the insurer’s reasoning in order to make a strong appeal.
Gather Supporting Documents
Collect all relevant documents that might help support your claim. This can include:
- Medical records and bills
- Correspondence with the insurance company
- Photos, reports, or any additional evidence related to your case
Solid evidence will serve to strengthen your argument and make your appeal more likely to succeed.
Write an Appeal Letter
Draft a detailed letter explaining why you believe the insurer’s denial was incorrect. Address each point mentioned in the denial letter and provide evidence to counter the insurer’s claims. For best results, be clear, concise, and organized yet assertive in your presentation.
Submit Your Appeal
Follow the appeals submission guidelines the insurance company provides. Make sure to send your appeal within the specified timeframe to avoid automatic rejection due to late submission.
Request an External Review (If Applicable)
In some cases, you may have the option to request an external review. This involves having a neutral third party assess the insurance company’s decision. This step can provide an unbiased evaluation and potentially lead to a reversal of the denial.
Escalate the Appeal If Necessary
If your appeal is also denied, you have a couple of options for escalating the matter:
- Contact your state’s insurance regulatory agency for assistance.
- Consult an attorney who focuses on insurance disputes to explore legal recourse.
Persistence and thorough documentation are key to a successful appeal. Make sure you have all the necessary information to support your case and don’t give up.
Take Action to Protect Your Rights
If you’ve filed a personal injury claim and had it denied, it’s important not to lose hope. Knowing your rights and understanding the reasons behind the denial can help you take the right steps to appeal the decision.
Gather all necessary documentation, follow the insurance company’s appeals guidelines to the letter, and don’t hesitate to seek professional legal advice if needed.
You don’t have to put up with underhanded insurance tactics. Schedule a free consultation with a dedicated personal injury attorney at Cameron Law today and see that you receive the fair treatment you deserve.
