Note: This article deals with the issue of when your own insurance company won’t pay or denies your claim. It does not deal with what you should do if you get in an accident with another driver, who either does not have insurance, or whose insurance company won’t pay you.
Getting in a car accident is one of the worst experiences of any person’s life. After the event, most drivers take at least a small amount of comfort from the fact that they are insured. But what happens if your car insurance company denies your claim, or refuses to pay?
There are several things you can do to try and resolve the situation; from the simple and cheap to the time consuming and the expensive. Your success will depend primarily on the circumstances surrounding your accident and what is included in the report by the claims adjuster assigned to your case. Here are some things you can try, in order from the simplest to the most complicated.
Check Your Policy And Contact Your Auto Insurance Company
The first thing you should do, after your insurance company denies your claim or says they won’t pay you, is check the reason why they are doing so. Your denial can be based on a whole host of reasons depending on the type and amount of your claim and what the report from the claims adjuster includes.
For example, if you are seeking a liability claim, but were found to be more than 50% at-fault in an accident, your insurance company can legally deny your claim in most states. A second example, is that you get in a minor fender bender and sustain $200 worth of damage. You seek payment from your insurance company, but they deny it, claiming you have a $500 deductible. Again in this situation they are legally allowed to deny your claim.
A third example where a insurance company could deny your claim, is the following: you are driving on a road in winter and your car spins out of control and hits a tree. You’re fine, but your car sustains $2,500 worth of damage. You file a claim with your insurance company for the damages minus deductible. However, they deny your claim saying that you don’t have collision coverage on your policy, just liability insurance.
Therefore, the first thing you need to do is read why the insurance company has denied your claim. You then need to read the fine print of your policy and see if their reasons match what is covered under your policy. If their reasons are sound; based on what is actually included in your policy (and not what you may think is in it), then you are probably our of luck.
However if you think there has been an error, your next step should be to contact your insurance company and explain what you think has happened. In most cases, this will likely not work, but it is worth a shot because it is so easy to do.
Contact Your State’s Insurance Department/Division of Insurance
If your attempt at trying to resolve the issue with your insurance company on your own fails, then your next step should probably be to get in contact with your state’s Insurance Department/Division of Insurance. Some can help you resolve the issue, although most can not. Instead what you can do is leave a complaint with them about your insurance company’s behavior.
Many state Insurance Departments publish company complaint ratios. The more complaints a given company has the worse its ratio. If a company gets enough legitimate complaints, then it may have its license to operate in the state reviewed and possibly even revoked.
When getting in contact with your insurance company you may just want to mention you will be filing a complaint against them, if they can’t resolve the issue amicably. If they feel they are truly in the right and you are in the wrong, then it may make no different. Nevertheless, company’s do want to maintain a good complaint ratio, so they may be more willing to work with you.
Finally, some state Insurance Departments can help you get binding, impartial arbitration with your insurer. You will be bound by the arbiter’s decision, but can be a much cheaper option than going to court. Unfortunately, this option is not open to many states, so you’ll have to check what laws govern yours.
You can find out more about insurance in your state, including where to find your state’s Insurance Department from the following pages:
Hire A Lawyer
Finally, if you fail to get your insurance company to budge after filing a complaint, and binding arbitration is not an option, your last choice is to hire a lawyer and take your auto insurance company to court. This is likely to be expensive and extremely time consuming. As tempting as it might be, it only makes senses in cases where there is a large amount of money at stake.
These are your main options when dealing with your own insurance company if they won’t pay, or choose to deny your car insurance claims. Once you have the report from the claims adjuster and the verdict from your insurance company, you can then proceed through the steps above. To find other insurance company’s in your area please enter your zip code below and get instant car insurance quotes.