What are My Options if the Insurance Company Won’t Pay?

When you file an insurance claim after a car accident, you may not be ready for the hassle that comes with making the claim. Even if the process is complicated, you fully expect to receive a payment to cover your losses. Regardless of whether you are filing a claim with your insurance company or with another driver’s insurance carrier, these carriers should uphold their legal obligations to handle the claim in good faith.

But what happens if the insurance company says they will not pay? What if you have done everything correctly and they refuse your claim?

If this happens, you could be the victim of “insurance bad faith.” In these cases, you could be entitled to compensation beyond your original claim.

Insurance denied.

Why would insurance companies deny a claim?

There are times when insurance companies deny a claim and it is not an issue of bad faith. If the injuries or property damages you have submitted the claim for are not covered by the policy in question, they are not obligated to pay.

It is also important to remember that insurance companies are for-profit, and they will do what they can to reduce the amount they pay in any settlement. They have the right to investigate any claim made against the policy and determine an appropriate coverage response. They will look into things such as:

  • Whether the policy covers the damages at all.
  • Whether the driver in question was at-fault.
  • Whether the injuries and damages claimed actually occurred.

What are the signs of insurance bad faith?

If you have received a formal denial of coverage response from the insurance company, but you believe your claim is legitimate, you should look into whether they are operating in bad faith. Some of the signs that an insurance carrier is operating in bad faith include:

  • Receiving an unreasonably low settlement offer
  • Misrepresenting the policy information or coverage amounts
  • Refusing to consider all relevant evidence in the case
  • Failing to respond to communications
  • Failing to provide an explanation for the claim denial

If any of these scenarios has occurred, you should seek help from an experienced attorney who understands car accident cases and has dealt with bad faith insurance issues.

Proving bad faith requires working through the court system. Different states have certain laws and processes in place to deal with these cases. However, if you are the victim of bad faith insurance practices, you and your attorney can take steps to prepare for a case. This includes keeping all:

  • Relevant documents related to the policy and the accident in question
  • Communication records between you and the carrier, including emails or other correspondence
  • Copies of photographs or evidence you submitted to the carrier

Will you need to file a lawsuit?

Your case could end up in court. However, if you secure an attorney and let them handle all communication with the insurance company, you may well find they are willing to talk and settle the case. Insurance companies often treat clients represented by an attorney differently than ones who are not represented. Your lawyer in this case will make a demand for the payment you deserve. If there is evidence of insurance bad faith, your attorney will raise this with the company. If the company still refuses to pay, you may need to take your case to court. You could end up with a much larger settlement if the insurance company is found guilty of bad faith.