May 30, 2024 | Insurance Disputes

We invest in insurance as a safety net. Insurance is meant to act as a cushion against the unexpected. It is a promise that we will have the support we need when a crisis strikes. However, for many this isn’t the case. Many that are faced with crises find that the very insurance that they hoped would get them through the difficult period is not made available. Studies show that one in seven insurance claims are denied. This amounts to more than 200 million rejections a day. Below, we explore the most common reasons insurance claims are denied and why they are denied.

Why Insurance Companies Deny Claims

The claims process can be complex. Facing an insurance claim denial can be frustrating and even bewildering especially when you’re facing unexpected losses or expenses. Understanding the common reasons insurance companies deny claims can help policyholders navigate the claims process more effectively. Some of the most common reasons behind claims denials include:

• Policy exclusions – insurance companies include specific exclusions in their policies. These outline scenarios or types of damages that are not covered by the policy. If your claim falls within one of these excluded categories, the insurance company may deny your claim outright.
• Lack of coverage – if the damages or losses you are experiencing are not covered under your policy, the insurance claim will be denied. It is therefore essential to review your policy’s coverage limits and provisions carefully. You should take the time to know what is and isn’t included.
• Failing to disclose information – insurance companies require you to provide accurate and complete information about your circumstances e.g. your medical history or your driving record. If you fail to disclose relevant information or provide false information, the insurance company may deny our claim based on misrepresentation.
• Policy lapses or non-payment – insurance policies require regular premium payments to remain active. If you fail to pay your premiums on time, your policy may lapse, leaving you uninsured. In such cases, claims made during the period of non-payment are likely to be denied.
• Coverage limitations – many insurance policies impose limits on the amount of coverage provided for certain types of damages or losses. If your claim exceeds these limits, the insurance company may only partially approve your claim or deny it altogether.
• Delay in reporting – most insurance policies require policyholders to report claims promptly after an incident occurs. Failure to report a claim in a timely manner can give the insurance company grounds to deny it, especially if the delay hinders their ability to investigate the claim effectively.

Tactics Insurance Companies Use to Deny Insurance Claims

Even when you meet all the requirements of the insurance company, you may still face a denial. Below are some common tactics insurance companies employ to deny claims.

• Policy interpretation

Insurance policies are legal documents that are often filled with complex legal jargon. Unfortunately, this legal jargon can be interpreted in multiple ways. Many policyholders do not understand the implications of the fine print in their policy agreements. Insurance companies often exploit the ambiguity in their policies to deny claims. Even legitimate claims may be denied thanks to this ambiguity.

• Investigation delays

Another tactic that insurance companies often employ is dragging out the insurance claims process. They often do this by causing delays in the investigation phase. They may request unnecessary documentation for example. These delays are done in the hope that the claimant will give up or that they will accept a low ball settlement out of frustration.

• Lowball settlements

Even when the claim has been accepted, insurance companies will still do what they can to minimize their losses. This often includes making a lower offer for settlement than the actual cost of damages suffered. Many policyholders are forced to accept these significantly lower settlement offers as they are in difficult economic positions and simply want to get on with their lives.

• Exclusions and other technicalities

Insurance companies often include obscure exclusions and loopholes in their insurance policies. These allow the companies to deny claims on technical grounds. Even when a claim seems valid on the surface, the insurance company can refer to the exclusions or other loopholes to get out of paying the insurance claim.

• Simply denying claims

Sometimes insurance companies won’t even give a reason for denying the claim. They will simply deny the claim and not provide a valid reason or explanation. This can leave policy holders bewildered and stranded. Many don’t know that they can fight the denial of the claim and simply give up.

Denied Claim – Contact High & Younes, LLC for Help

Has your claim been denied? Enlisting the services of an experienced attorney can level the playing field when confronting denied insurance claims. Our experienced and skilled legal team can help to tip the scales in your favor. Contact us now to schedule free consultation with an experienced attorney at our law firm. We will fight to achieve a favorable outcome in your case.

Insurance Company Screwing Me Over