Let’s talk about an essential aspect of every car owner’s life — car insurance, and more precisely, discuss why an insurance claim can be denied. We’ll also cover the things you can do if the insurance company denies your claim.
If your claim gets denied, you will get a rejection letter stating why your car insurance will not pay out. Luckily for you, you don’t have to accept this as a final judgment and can challenge the reasons for denial of the claim. The rejections often happen due to the lack of supported facts.
Let’s discuss the most common reasons why a car insurance claim can be denied.
If you get into an accident while driving under the influence of alcohol or drugs, the car insurance company will most probably deny your claim. However, if you don’t tell the insurance agent about DUI, you risk getting into more considerable trouble.
Wondering whether there are any exceptions? Yes, but it’s tricky, as you will have to prove that you were not under the influence of alcohol or drugs, or in other words, you will be guilty until proven innocent.
Should you get in a car accident with an uninsured motorist, your car insurance may refuse to pay the claim. Another reason the car insurer will not pay out is during the hit and run situation.
When another driver is at fault for the accident, their auto insurance may deny the claim. There could be several reasons: a lack of coverage or providing incorrect insurance details.
In the unfortunate case of getting into an accident, first, find help for all injured people as soon as possible. Next, inform the police, take pictures with your phone, call the insurance agency, and notify them of the accident. Should you fail to report the accident in the allotted time, your car insurance claim will get denied.
To be denied an insurance claim in bad faith means the insurance agency lacks adequate evidence to make a proper decision. You have a ground to appeal if this happens.
Proof of loss should support your request for a car insurance claim, and should you forgo supplying it, the claim will probably get denied. Proof of loss can be a medical bill, a car repair bill, a police complaint report, and similar documents.
A car insurance claim will be denied if you drive a faulty vehicle or use your vehicle for purposes not stated in the insurance policy. In addition, if you have been negligent with your car or made modifications that you’ve not reported to the DMV, you are risking getting your car insurance claim denied.
All auto insurance claims should have the correct information. If you mistakenly or purposefully enter false information, your claim will be denied, and you can also be found guilty of misrepresentation. It is illegal to lie on your car insurance claim. However, if you make a small mistake, like entering an incorrect birth date, it can be easily fixed.
In the case of having your insurance claim denied, you have the option to file a suit against the insurance company. You can sue them for bad faith insurance practices, breach of contract, violations of your state’s insurance code, and more.
When filing an insurance claim, you will be asked to submit supporting evidence to your claim during a specific time frame. Your car insurance claim will probably be denied if you fail to respond to this request on time.
While many insurance claim denials are valid, generally, insurance companies will do everything in their power to deny a claim and save money.
Now that you know the top most common reasons why this happens, you can take all necessary steps to prevent your car insurance request from being denied.
You can appeal against the insurance’s company decision or get an offer for damages.
Lapsed insurance policy, policy exclusions, lack of coverage, and all the other reasons stated above.
You can appeal the denied claim or file a suit against the insurance company based on the denial letter.
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