Filing an auto insurance claim seems like an easy process. You file a claim after you were in a car accident, and possibly injured, expecting to be have your vehicle repairs and medical bills paid.
Occasionally an auto insurance claim is denied by an insurance company. Policyholders don’t have to be left holding the bill, and have a few options.
Start by appealing the decision. Insurance companies have internal appeal processes for policyholders to appeal a decision that they think was wrong or unfair.
Explain in your letter how your evidence contradicts the insurer’s decision. Include copies of evidence, such as photographs, eyewitness reports, medical records and the police report. Connect each piece of evidence to your argument against the adjustor’s decision.
If an appeal is denied, you can file a complaint with your state insurance department. You can also hire an attorney for advice on what to do.
Before appealing, read your insurance policy carefully and know its limitations. Some things that you think are covered may not be.
What if you caused the accident?
One of the main reasons your claim may be denied is simply because you’re at fault for the accident. This may be obvious — you ran a stop sign or were drunk while driving. Your insurer likely won’t pay if the accident is your fault.
Sometimes determining fault is more complicated, and you’ll be liable if you could have avoided the accident. That stop sign you’re accused of running through that led to an accident could be your word against the other driver’s. You stopped, but they ran through the intersection.
Or maybe you didn’t leave enough room in front of your car while stopped behind another vehicle. A car rear-ends you and you hit the car in front of you. You’re held responsible because if you were back further you might not have hit the car in front of you.
In determining who is at fault, the insurance adjustor must explain why in the claim denial letter. One way to resolve this is to make your case that you couldn’t have prevented the accident and that you weren’t doing anything to avoid it. A lawyer should be able to help if this is the case.
As stated above, you should know your policy’s limits before appealing a denied claim. If you don’t have enough coverage in the area of your claim, you’ll likely be denied.
For example, if your $100,000 car is totaled and the at-fault driver only has $50,000 limit in property damage, then you could be stuck to pay the remaining $50,000.
To resolve this before it happens, make sure you have uninsured-underinsured motorist coverage.
If damages exceed your auto policy limits, your claim may not be denied but the amount paid will be limited to your policy limits. However, insurers can deny the entire claim.
Driver not on policy
If the driver caused the accident but isn’t named on the insurance policy, the claim could be denied.
This can happen if a teenager who has a learner’s permit is driving with their parent as a passenger and causes an accident. If the parent didn’t tell the insurer that their teen was starting to drive, they may not be covered.
This applies to your policy too. Make sure that anyone who is driving your vehicle is listed on your insurance policy.
If you haven’t paid your premiums or missed a filing deadline and your policy is no longer active, then you won’t be covered. This shouldn’t come as a surprise if you haven’t paid your insurance bill.
If you missed a deadline to file a claim, or missed some other deadline in renewing your insurance, don’t expect your insurance company to notify you of an upcoming or missed deadline. You should file a claim quickly after an accident.
Another exemption from an insurance policy is if you’re using your vehicle for business but don’t tell your insurance company about it.
If you cause an accident while using your car for business — even for a short trip — you might not be covered if you haven’t told your insurer ahead of time that you use your car for business trips.
What to do
Appealing an insurance claim denial long after an accident can be difficult for many reasons, starting with the fact that your memory may not be as accurate.
To have the best chance at getting your claim approved, there are some things you should do at an accident scene and immediately afterward to make sure you are providing correct information.
Start by taking notes and photos of the accident scene and getting contact information from witnesses. Keep all the paperwork for your injuries and vehicle damage.
If you’re unsure what to do, you may want to seek the help of an attorney. They can help you through the claims process and an appeal if necessary.