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Common Insurance Claim Denials and How to Handle Them
You may feel relieved because you have an insurance policy if you have suffered a loss. However, the situation may become stressful if the insurance company denies your claim. The insurance company must give you a reason when they deny your claims. Here are some reasons why insurance companies commonly deny claims and what you may be able to do about it.
The Policy Does Not Cover the Damage
Perhaps the most common reason why an insurance company denies a claim is because they claim that the language of the policy does not cover the damage. Sometimes, you and the insurance company will dispute what exactly is covered. The insurance company may argue that something falls into one of the many policy exclusions. In other cases, there may be disagreement over what the actual language in the policy means. The court may be called upon to interpret the language of the policy. A lawyer’s advice in pursuing your insurance claim may maximize your recovery.
The Insurance Company Did Not Perform an Adequate Investigation
There could be oversights and errors in the insurance company’s investigation of your claim. They may have concluded without adequate research. This often happens when the insurance company faces many claims that it needs to respond to within a short time. In the haste to respond, the insurance company may reach the wrong result because it simply did not do its homework.
The Insurance Company Blames You for What Happened
Your actions could become an issue if the insurance company thinks you caused the loss. The insurance company may blame you for the loss itself or for failing to take action to mitigate the loss after it occurred. Alternatively, you could be held accountable for the belief that you failed to maintain the property properly. The insurance company could also allege that you delayed notifying them in a timely fashion. The Policy often dictates the time period in which you are required to notify the insurance company of the loss and the method of communicating your notice, which is strictly enforced by the carrier depending on the nature of the policy.
The Insurance Company Is Acting in Bad Faith
Insurance companies do not always have a justifiable reason for denying your claim. Sometimes, an insurance company may deny your claim for a dubious reason. You may have filed a legitimate claim, and it was denied for no specific good reason or on wrongful grounds.
If the insurance company has acted poorly enough, you may be able to sue them directly for bad faith. Then, their conduct would be an issue in the trial. You could recover damages based on how you suffered from the insurance company’s actions. You have a high bar to prove bad faith, although plaintiffs have won large sums of money in these lawsuits.
There Is a Problem With Your Claim
The insurance company may think that you made an error in your claim. There could be something wrong with the paperwork that could preclude you from receiving payment. In other cases, the insurance company may say that you did not follow the requirements for filing a claim, such as notifying them in the timeframe required by the policy.
In other cases, the insurance company may even believe the claim is fraudulent. Insurance companies have started using AI to screen claims. The information in your claim may have set off warnings for them based on the algorithms in their program.
If the insurance company has wrongfully denied your claim, you might be able to sue them for payment. Your insurance policy is a contract between you and the company that sold it to you. They must pay you if your loss falls within the contract’s language. A court would have the final say over whether you have the right to a recovery under the terms of your policy.
Our New Jersey Insurance Attorneys at Herold Law, P.A. Can Fight on Your Behalf
When you call our New Jersey insurance attorneys at Herold Law, P.A., you can fight an insurance claim denial. Call us today at 908-679-5011 or complete our online form to schedule a consultation. With offices in the Plainfield area, including Warren, New Jersey, we proudly serve clients across New Jersey.
