Steps to Take When Your Car Insurance Claim Is Denied

Were you recently injured in a car accident? Did you assume that your auto insurance company would cover your medical bills, property damage, and other losses but instead receive a denial?

Consumer Affairs reported that in one recent year, there were 4.2 collision insurance claims per 100 drivers. However, many of those claims were denied for various reasons. Discovering that your car insurance claim has been denied can be both frustrating and stressful.

A denial doesn’t always mean the end of the road for your insurance claim. There are steps you can take to understand the situation and possibly reverse it. 

1. Understand Why Your Claim Was Denied 

It is important to understand the specific reasons for the denial. Insurance companies are required to provide a written explanation when they reject a claim.

Common reasons for denials include:

• Policy exclusions: Typically, insurance policies list specific scenarios that are not covered. If your car accident falls under one of these excluded categories, your claim may be denied. 
• Policy lapse: If your coverage expired due to non-payment or other issues, the insurer will deny the claim.
• Insufficient documentation: Claims often require extensive documentation or paperwork. Missing or incomplete paperwork could lead to a denial. 
• Fault disputes: The insurer might disagree about who was at fault or the degree of fault in an accident.
• Pre-existing damage: An insurer will deny a claim if they believe the damage was pre-existing and not a result of the reported car accident. 
• Violation of policy terms: For example, using the vehicle for business purposes when the policy only covers personal use. 
• Delays in filing: Waiting too long to report the accident or file a claim can lead to a denial. 

2. Review Your Insurance Policy

Carefully review the explanation and compare it with your policy details. It is possible that the insurance company denied your claim in error. 

While reviewing your policy, pay attention to:

• Coverage types: Ensure the damages or the incident falls under the coverage you purchased, which could be collision, liability, or comprehensive 
• Exclusions: Check for clauses that might exclude the specific situation
• Claim filing requirements: Confirm whether you met the deadlines and the documentation requirements

Does the insurer’s denial explanation align with the terms of your policy? If not, you may have grounds to dispute the denial. 

3. Contact the Insurance Adjuster

You can reach out to the claims adjuster assigned to your case for further clarification. But when you’ve hired a legal representative, your lawyer will handle all communication with the insurer on your behalf.

During this discussion:

• Request clarification: Politely ask for a detailed explanation of why the claim was denied
• Point out inconsistencies: If you find errors in the adjuster’s reasoning, bring these to their attention
• Submit additional evidence: Provide any new documentation or information that supports your claim

Document all interactions with the insurer. This includes dates, times, names, and summaries of the conversations.

4. Gather Additional Evidence

If you think the insurer wrongfully denied your claim, you will need proof to overturn the decision. You can gather evidence to show that it was made in error. The reason for the denial will influence what type of evidence is beneficial. 

Common types of evidence include:

• Photographs: Provide clear pictures of the damages or accident scene
• Police reports: Obtain and submit a copy of the official accident report
• Witness statements: Gather written statements from any witnesses to the incident
• Repair estimates: Include quotes or invoices from auto repair shops
• Medical records: If injuries were involved, submit detailed medical reports and bills

It could be that providing relevant documents will be enough for the insurance company to revoke the denial.

5. Appeal the Denial

Most insurance companies have an internal appeals process that allows policyholders to dispute denied claims. 

The denial letter should include information regarding your right to file an appeal and how to do so:

• Write a formal letter: Explain why you feel the denial was incorrect; cite specific policy terms and supporting evidence
• Attach documentation: Include all additional evidence and correspondence
• Follow deadlines: Ensure that your appeal is submitted within the time frame specified by your insurer

Filing an appeal can be time-consuming and overwhelming. If you hire a car accident lawyer to represent you, he or she will file the appeal for you. 

6. File a Complaint With State Insurance Regulators

What if your claim is unsuccessful or you suspect bad faith from your insurance company? Consider filing a complaint with your state’s insurance department. Insurers are regulated by state authorities. They are required to handle claims fairly. 

Provide all relevant details, such as:

• Your policy number
• The insurer’s denial explanation
• Copies of supporting evidence and correspondence

State regulators can investigate the matter and, in some cases, mediate a resolution. 

7. Explore Other Avenues of Compensation

If your insurance claim is denied, you may want to explore alternative options for compensation, such as:

• Underinsured/uninsured motorist coverage: If the other driver was at fault and lacked sufficient insurance, your own policy might offer coverage
• Third-party lawsuits: If another party was responsible for the crash, you may be able to file a personal injury lawsuit against them
• Health insurance or other policies: Your health insurance may cover medical expenses, while a collision or comprehensive auto policy might address vehicle repairs

8. Consider Mediation or Arbitration

Some insurance policies include a provision for arbitration or mediation to resolve disputes. These methods can be quicker and less expensive than going to court. 

During mediation, a neutral third party facilitates a discussion to help both sides reach an agreement. Arbitration, on the other hand, involves a binding decision by a third party. 

Check your policy to see whether these options are available, and consider hiring a car accident lawyer for further guidance.

9. Hire a Car Accident Lawyer

If your insurance claim is denied, it is recommended to contact a personal injury lawyer. Hiring a lawyer can be your key to ensuring that your rights are protected and you receive the compensation you deserve. 

A car accident lawyer will:

• Review the denial letter: An attorney will analyze the specifics of your denial and determine whether it was justified. Your lawyer will identify any inaccuracies in the denial letter and determine whether the insurer acted in bad faith.
• Investigate the car accident: Your lawyer will conduct an independent investigation to gather evidence to support your claim. This might include witness statements, police reports, medical records, or photos from the accident scene. 
• Negotiate with the insurance company: Experienced personal injury lawyers understand insurance company tactics and how to deal with these effectively. They will negotiate for you, presenting evidence to refute the denial and push for a fair settlement. 
• Protect you from bad faith practices: In some situations, an insurer’s denial may constitute bad faith. If bad faith is suspected, your lawyer can take legal action against the insurance company to seek additional damages. 
• File a lawsuit if needed: If negotiations fail, your lawyer can file a lawsuit against the insurance company. This stance demonstrates your commitment to pursuing justice and often pressures the insurer to reconsider the denial. 

The Benefits of Hiring a Lawyer to Handle Your Car Insurance Claim Denial

You may be debating whether to try to handle a denied insurance claim on your own or contact a lawyer. 

Consider some benefits of having a knowledgeable personal injury attorney on your side:

• Knowledge: Personal injury lawyers are knowledgeable in insurance law and understand the tactics used by insurers to deny claims.
• Saving time: Handling a denial can be time-consuming and stressful — especially if you are recovering from injuries. Your lawyer will manage the legal aspects of your claim, allowing you to focus on recovery. 
• Higher compensation: Claimants represented by car accident lawyers may receive higher settlements compared to those who handle claims on their own. 
• Peace of mind: Having a professional advocate on your side provides reassurance that your case is in capable hands. 

What to Look for in a Car Accident Lawyer

When choosing a lawyer to handle your claim, consider the following factors:

• Experience: Choose a lawyer with a proven track record of successfully handling car accident claims and disputes
• Communication: A good lawyer should be transparent, responsive, and willing to answer your questions
• Reputation: Look for reviews, testimonials, or referrals from previous clients

Get Help With Your Car Accident Claim 

A car accident is an overwhelming experience. It often leaves victims with physical pain, emotional trauma, and financial burdens. When you file a claim with your insurance company, you expect fair treatment and compensation. 

Unfortunately, some car accident claims are denied, leaving victims unsure of what to do next. If your insurance claim has been denied, a lawyer can challenge the denial and fight for the compensation you deserve on your behalf.

Contact our Hauptman, O’Brien, P.C. today to get help recovering compensation after your car accident. We serve victims of car accidents in Nebraska via our offices in Omaha, South Omaha, and Bellevue, as well as Iowa clients, via our office in Council Bluffs. We offer free case consultations. Schedule yours today by calling (402) 241-5020 or completing our contact form, and someone will get back to you shortly.