If you have an insurance claim that you suspect has been unlawfully denied, you may need to take legal action to get the compensation you deserve.
As a policy holder, it’s fair to expect that when you file an insurance claim, your insurance company will cover it. After all, you pay your premiums every month, whether for health, property, or auto insurance. You do that because you expect your insurance company to have your back when you need it. But things do not always play out that way.
Why do insurance companies deny claims? An insurance claim lawyer can help you examine your policy, figure out why your claim was denied, and get the claim approval you deserve.
What Are Insurance Companies Supposed to Do?
Your insurance company is obliged to conduct a reasonable investigation of your claim once you report it. If you are expected to use particular forms to submit your claim, the company is supposed to provide those promptly, along with reasonable explanations of how to use them. The company is also supposed to help identify what coverages you purchased that may apply to the loss you have experienced.
When you pay premiums, you are paying not just for coverage, but also for the services of your company’s claims department. The company has a right to expect reasonable cooperation from you, but the ultimate responsibility to investigate a claim belongs to the insurance company. That includes letting you know what information may still be needed to process your claim.
The law imposes many other duties on your insurance company. For instance, your company has a legal duty to either affirm or deny coverage within a reasonable time after the claim investigation. And if an insurance company denies your claim or offers only a partial payment to compromise the claim, the company must promptly provide a reasonable, accurate explanation of its decision.
The most basic duty an insurance company owes you is the duty of “good faith and fair dealing” – to not act in bad faith. But sometimes insurance claims are denied in bad faith. An insurance company may misconstrue facts to try to justify a denial. It may fail to investigate the claim properly, or ignore the results of an investigation that favor payment of the claim. Sometimes the company misapplies the terms of a policy to suggest falsely that benefits are not due, or are due in lower amounts.
“Some of the nation’s biggest insurance companies—Allstate, AIG, and State Farm, among others—have denied valid claims in an attempt to boost their bottom lines,” says the American Association for Justice. “These companies have rewarded employees who successfully denied claims, replaced employees who would not, and when all else failed, engaged in outright fraud to avoid paying claims.” Sometimes this takes the form of delaying claim processing, hoping the policyholder gives up or cancels the policy retroactively. Sometimes insurance companies even try to rescind a policy in retaliation for a policyholder making a claim.
If you have had an insurance claim denied or unreasonably delayed, have an insurance claim lawyer review your case. Get the help you need. If you live in South Dakota, contact Turbak Law Office at 866-231-0914 to schedule a consultation. We can answer your questions and provide sound advice related to your situation.