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What to Do When an Insurance Company Denies a Valid Claim

April 26 2023 | Insurance Bad Faith

If you get injured in an event such as a car accident, you may assume you will receive a fair payment to cover your medical costs and property damage – especially if you were not at fault or have never missed a payment on your insurance policy. Unfortunately, insurance companies do not always act in good faith. If your claim is valid but gets denied, options are available to you to appeal the decision.

Read the Claim Denial Letter

The first step in dealing with an insurance claim denial is understanding the reason given for the rejection. By state law, insurance companies must give an explanation in writing to a claimant when a claim is denied. Common reasons insurance companies give for rejections include:

  • Missing or incorrect information
  • Lapse in coverage due to missed payment
  • Missed filing deadline
  • Failure to mitigate damages
  • Lack of medical evidence
  • Liability dispute

Read your claim denial letter carefully. Then, read the language of the insurance policy to find out if you have a covered loss under its terms and provisions. You may be able to remedy the issue by submitting further information or making corrections to your claim.

Contact the Insurance Company

Call the insurance company to further discuss the reason for the denial. If you can, record the conversation. Let the insurance representative know that you are recording. Before you call, gather additional evidence about your claim. Having supporting evidence nearby, such as your medical records, witness statements and photographs, can help you prove that the insurance company’s decision was incorrect. Many claim denials are due to minor errors or misunderstandings and can be cleared up with a simple conversation.

Appeal the Decision

If contacting the insurance company does not reverse its decision, begin the appeals process. Contact the insurer and explain that you wish to file an appeal. You may wish to contact a personal injury attorney beforehand to help you with the appeals process. An appeal can be complicated, and you want to give it the best odds of success by seeking professional input. An attorney can find out why your claim was denied and help you request an internal review by the insurance provider. Your lawyer can also draft an appeal letter explaining why you do not agree with the insurance company’s decision.

File a Complaint

If the insurance company is still denying your claim, you can file a complaint with the Connecticut Insurance Department. The Department will review your case and may investigate the insurance company to learn more. If they agree that your claim has been wrongfully rejected or is being mishandled, they can take action against the insurance company, such as making the insurer pay a fine. The Department may also force the insurer to pay your claim if it is valid, plus an additional amount given to you in interest and penalties for the inconvenience.

Take Your Case to Trial

Finally, you have the right to bring your case to court in New Haven. You can go up against the insurance company or its policyholder in a personal injury lawsuit to seek justice and fair financial compensation, if necessary. During an injury claim, you or your attorney will need to prove that the defendant caused your injury or the damage being claimed. If you meet your burden of proof, you could receive a judgment award that requires the insurance company to pay for your losses. In most cases, judgment awards are worth much more than insurance settlements.

Bring an Insurance Bad Faith Claim

An insurance company can face various penalties for handling a claim in bad faith. Bad faith means to act with dishonesty or unfair dealings, such as wrongfully rejecting a valid claim or refusing to offer a fair settlement. If there is proof that the insurance company in charge of your claim committed bad faith, you can file an additional civil suit against the insurer for further compensation.

For more information about how to handle an insurance company claim denial, contact Jacobs & Jacobs to request a free case consultation.

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