How to deal with insurance that doesn't want to pay

How to deal with insurance that doesn't want to pay

            Each year, the National Association of Insurance Commissioners (NAIC) lists the most frequent grievances customers have against their insurance companies. The list is a compilation of data from state insurance departments, one of the main resources people can use to get assistance when they believe an insurance provider isn't treating them fairly.

Key Takeaways

• You have options if an insurance company or one of its agents has denied you a claim payment, treated you unfairly, or you believe they have cheated you.
• In the insurance sector, client complaints are handled by the NAIC, a federal organization. Additionally, several states have independent agencies.
• Ensure that you keep thorough records of all communications with the insurer you are filing a complaint against and retain any pertinent paperwork.
• You might wish to hire a lawyer who focuses on filing this kind of lawsuit in difficult matters.

Complaints

            Unsurprisingly, problems with claim management—the main reason why individuals purchase insurance in the first place—result in the great majority of complaints. According to information from the NAIC report as of June 2021, little over 18% of all complaints were the result of delays that policyholders encountered while waiting to receive a claim. Just over 13 percent of all complaints were about insurance companies' inadequate claim settlement offers, which was the second most common issue. Just over 12.5% of all complaints involved the denial of a claim. 1

            It's also important to note which insurance policies receive the most grievances. The results are not unexpected given that issues involving accident and health insurance make up the majority of complaints, or little over 41%. With just over 30.5 percent, auto is the next highest sector, and homeowners are right behind it with more than 15 percent. Life and annuity complaints account for around 8% of all complaints, after which the list becomes more condensed. 2

            Consumers should be aware of which insurance category receives the most complaints. For instance, maintain the same level of vigilance whether you need to file a claim for your health insurance or a car or homeowner's claim. Here are four actions you can take to combat an insurer who is refusing to pay your claim, delaying payment on it, or making what you believe to be a low-ball settlement offer.

Keep Pristine Records

            The work you completed before an accident can be quite crucial when it comes to claims. Keeping receipts and records of your valuables, especially the more expensive ones, is beneficial when it comes to insurance for your home's contents. One industry resource advises doing a tour of your house, filming every item with a video camera, and storing the tape somewhere safe outside of your house, either at work or in a safe deposit box. Keep a thorough record of who you spoke with, when, and what was said when challenging a claim.

            Evidence to support their elusiveness can greatly aid your case because dishonest insurance companies go out of their way to make the claims procedure challenging.

Take Advantage of the State Regulator

            Since it can drag out a claim in court for several years and significantly delay collecting funds needed to replace a home or pay for medical expenses, taking an insurance company to court should only be utilized as a last choice. The first step is to make an effort to communicate calmly and patiently with your insurance agent or provider, while simultaneously documenting the entire process. If they turn out to be challenging to work with, enlisting the aid of a state insurance regulator can assist the procedure move along.

Know Your Insurance Policy and Rights

            The easiest way to understand what should be anticipated if someone wants to file a claim is to carefully analyze a new or old insurance policy. It contains information on what is covered, how to file a claim, how promptly a claim must be made, and how the procedure for estimating damage reimbursement amounts works.

            It can be a good idea, especially if the sums are significant, to enlist the assistance of an attorney during a deposition where an insurance company interviews you to obtain information regarding an accident or the worth of belongings in the case of property & casualty insurance. Knowing your rights in the event of a dispute is as vital and should be covered in a policy or in a conversation with your agent, insurer, or state regulator.

Be Persistent

            When things go wrong, trying to get an insurance company to honor its claims obligations may be a very irritating and time-consuming procedure. Most instances should be considerably simpler, and insurance companies genuinely handle the majority of claims and disputes in a proper and moral manner. However, when problems do occur, people need to keep their insurance company informed with regular follow-ups and complete documentation of the entire process.

The Bottom Line

            Studies that rate specific insurance companies also exist, so it would be a good idea to research your current carrier and use these studies as a guide when looking for a new one. Again, the majority of insurance claims are processed correctly and promptly, but it helps to be aware of the difficulties you can run into if things don't go according to plan.