If you believe your insurance claim was incorrectly denied, hiring an experienced insurance attorney can improve your chances of successfully overturning the company’s decision. In fact, hiring an attorney even before filing the initial claim greatly increases the likelihood your claim will be approved.
Insurance companies employ different tactics based on whether the claimant has legal representation. For claimants without an attorney, insurance companies will often offer a low offer for valid claims and hope it will be accepted with little expense to the company. In cases where the claim is valid, but will require additional work from the claimant, companies take a gamble and deny the claim, hoping there will be no further action and avoiding an expensive payout. Unfortunately, both of these tactics work more often than they should.
Claimants with legal representation, on the other hand, put insurance companies “on notice” that the claim has legal validation and tactics to avoid payouts will most likely not work.
Why Do Insurance Companies Deny Claims?
There are several reasons insurance companies deny claims and, depending on the circumstances, the reason may or may not be legitimate. Reasons commonly cited for denial are:
- No coverage: Insurance companies may deny coverage, arguing that your claim is not covered under your policy, though language ambiguities typically favor the insured. Review what is excluded in the policy as to whether the insurance company’s denial is valid.
- Application errors: A common occurrence, insurance companies may claim that errors on the original insurance application nullify coverage.
- Claim errors: Be sure to review your policy regarding the insurance company’s requirements for bringing a claim, such as the allotted time to notify the company, which can be 24 hours or less.
- Fraud: Attempting to file an insurance claim based on false or exaggerated information is fraudulent and can result in criminal charges.
- Bad faith: Simply put, “bad faith” denials are the company’s attempt to avoid paying claims without actually saying so. Instead, the denial will be stuffed with confusing legalese and policy jargon to disguise the attempt. Bad faith denials are grounds for filing a lawsuit if the motives can be proven.
Can I Sue My Insurance Company?
Regulations require the insurance industry certain obligations to policyholders to act in good faith, avoid unfair trade practices, and to follow the terms of the contract. Insurance companies are regulated at the state level and vary with each state, however, most regulations state that insurance companies cannot:
- Refuse to play claims with clearly met liability
- Fail to make a claim decision within a specified or reasonable time period
- Deny a claim without providing a reason
- Delay or perform inadequate investigation related to the claim
- Deny claims for misstatements on the application after the period of contestability
- Refuse to defend the insured in a liability lawsuit with one or more claims covered by the insured’s policy
Though each state has its own laws and regulations, all states allow breach of contract lawsuits and most permit bad faith lawsuits. Both lawsuit types also allow for compensatory damages, such as medical bills and loss of income.
If you feel your insurance company falsely denied your claim and is unwilling to appeal, you may have grounds for bringing a lawsuit against the company. If your insurance company is being uncooperative before reaching a decision on your claim, it may be beneficial to hire an attorney to represent you. Legal representation often helps persuade insurance companies to maintain their obligations and reach a fair settlement.
What Should I Do if I Think My Claim was Falsely Denied?
If you feel your claim was incorrectly denied, there are options to try and have the decision corrected. As with any accident and insurance claim, preparation and documentation are crucial, whether you decide to sue the company or not. Even before a decision on your claim has been reached, you should:
- Document correspondence: Maintain records of all correspondence you have with the insurance company and representatives. Keep copies of letter and emails and make notes during in-person or telephone conversations, including the representative’s name, contact information, date, and time. Keep in mind that the insurance company is probably recording the call.
- Property records: It is good practice to document your insured property and update the records every few years or with significant additions or changes. Take photos or videos of the property, such as vehicles, houses, and belongings, along with written lists or descriptions and values. Following an accident, take photos or videos as well, which can be compared to and submitted with your previous documentation of the items prior to the damage.
- Expense records: Keep documentation of any expenses resulting from the accident, such as medical bills, repair or replacement costs, loss of wages, and attorney’s fees.
- Hire a lawyer: Insurance lawsuits can be complex, lengthy, and costly. Obtain an attorney with insurance litigation experience to represent you through the process and secure the best possible outcome.
When it comes to filing insurance claims, it is highly recommended that you consult an attorney before filing anything and speaking to the insurance company to avoid hurting your case. Insurance claims and lawsuits can be incredibly complex and insurance companies can often be skilled in manipulating the situation in order to avoid paying. An attorney experienced in cases involving insurance companies can be valuable to the success of your claim. In some instances, attorneys will accept an insurance claim case on a contingency basis, meaning there will be no cost to the client unless the client wins the lawsuit.
New Jersey Insurance Lawyers at Herold Law, P.A. Represent Clients Whose Insurance Claims Have Been Falsely Denied
Incurring costs related to an accident accumulate rapidly, and being denied compensation by the insurance company can be financially devastating. If you have filed an insurance claim for damages and have been falsely denied, the experienced New Jersey insurance lawyers at Herold Law, P.A. are available to represent you. Call us at today 908-647-1022 or contact us online to schedule an initial consultation. Located in Warren, New Jersey. We represent clients in Warren, Plainfield, and throughout New Jersey.