Dealing with an insurance company can be frustrating, especially when you have a legitimate claim, and the insurer is unwilling to pay. Insurance companies may deny claims for many reasons, including policy exclusions, lack of evidence, or even bad faith. If you are in this situation, it’s important to understand your legal options to maximize your settlement. To do so, consult a bad-faith insurance attorney to assess your case and file your claim.
Understanding Why Your Claim Was Denied
Before taking any legal action, review the denial letter from the insurance company and other relevant documents to determine the reason for the rejection. There are some key reasons why your claim might have been rejected.
If the policyholder fails to provide accurate and complete information during the application process or when filing a claim, the insurance company may deny the claim. This can include omitting pre-existing medical conditions or providing false information about the circumstances of the accident. Insurance policies often have specific exclusions that outline situations or events not covered by the policy. If the claim falls within one of these exclusions, the company may deny it. For example, if the policy excludes coverage for certain high-risk activities or specific types of accidents, the claim related to those events may be denied.
Sometimes, policyholders may assume they have coverage for a particular accident or injury, but their policy does not include it. Insurance policies often have specific requirements that must be met for a claim to be valid. This can consist of timely reporting of the accident, submitting the required documentation, obtaining medical treatment from authorized providers, or adhering to certain procedures outlined in the policy.
Finally, insurance companies may deny claims if they suspect fraud or if the accident resulted from intentional acts by the policyholder. Engaging in fraudulent activities, such as staging an accident or falsifying documents, is a serious offense and can lead to claim denial or even legal consequences. Once you know why the claim was denied, start researching legal avenues that can help.
Filing An Appeal
If an insurance adjuster unjustly denied your claim or agent because of errors or oversights on their behalf, then filing an appeal could resolve the matter without taking further legal action. An appeal is a formal request for reconsideration of your denied claim decision made by an independent physician or healthcare professional through the use of medical records and supporting documentation. Appeals generally involve submitting additional information onto a file, such as invoices from health care professionals’ services.
A Lawsuit Alleging “Bad Faith”
If you cannot resolve the issue with an appeal, your legal representative will assess the response and look for bad-faith reasons or arguments. If the organization has not done its due diligence, it will be evident in its denial. You could opt-file breach-of-contract lawsuit under tort laws, providing how the agency broke promises in contract terms.
To prove that a bad faith claim exists, you will need evidence that the insurance company acted with malicious intent. This may include emails or other documents showing that the insurer intentionally denied your claim without conducting an adequate investigation or without a reasonable basis. Once you have this evidence, consider hiring an experienced attorney to help with your case, as they can guide you through the legal process and increase your chances of success.
Negotiating a Settlement
If litigation isn’t feasible, given the inability to establish bad faith on behalf of the insurer, then engaging in settlement negotiations provides a possible resolution. A settlement is reached when both parties reach an agreement outside of court. The parties collectively agree upon compensation for damages without requiring court intervention after being advised by their attorneys based on the respective merits of each side’s arguments.
Getting legal representation where an experienced attorney can advise on negotiating techniques while working behind the scenes to craft favorable terms for clients is advisable. Before reaching an optimal settlement amount, your legal counsel will conduct a damage assessment and finalize an amount. This should reflect all economic and non-economic damages. Don’t contact the insurance company before speaking to a legal representative because they will likely give an initial settlement offer and push you to settle immediately. That figure may look appealing at first glance, but it will surely be less than you deserve.