The average American spends thousands (sometimes tens of thousands) of dollars per year on various types of insurance. There is automobile insurance, homeowner's insurance, renter's insurance, professional liability insurance, health insurance, vision and dental insurance, disability insurance, and the list could go on. You can be sure that insurance companies will capitalize on anything that carries even the smallest chance of loss or liability.
So, when something goes wrong and you need to file a claim, it's absolutely reasonable to expect your insurance company to keep their end of your mutual agreement. After all, you continue to uphold your end of the bargain every month when you pay your premium. Unfortunately, because large losses happen relatively rarely in an individual's lifetime, most people are not particularly well-versed in the way that insurance providers operate. There's no question that those companies are taking advantage of your ignorance; they have a significant amount of money on the line.
If you're going to try to level the playing field, it's important to understand the most common tactics used by insurance companies in order to avoid paying your claim:
Refusing to investigate a claim.
In order for your claim to be paid, it must be confirmed to be legitimate. In some cases, such as with auto accidents, you may also need to prove which party was at fault. There may be any number of factors that need to be explored, but if the insurance company refused to look into it, you may be denied payment.
Refusing payment on a legitimate claim.
Even if the claim has been found to be legitimate, the company may still refuse to pay. It is certainly not unheard of for a verifiable claim to go without reimbursement. In some cases, an insurance company will simply issue a very general denial without any clear explanation. Oftentimes, frustrated consumers will simply accept this as the final say, which is exactly what they hope you will do.
Delaying your claim until it dies out.
Delaying claims is another common tactic employed by insurance providers, and it is surprisingly effective. Policyholders simply become exhausted with the process of chasing after the insurance company for answers or payment. Even worse, there have been cases where, with the knowledge that the insured is terminally ill, long-term care insurers delay claims until patient death.
Intentionally confusing you, the policyholder.
The contract(s) that you sign in order to put your policy into effect are intentionally dense and difficult to comprehend. These companies know that you need insurance (and in many cases, are required by law to have it), and they know that you will probably sign whatever document is required in order to activate your coverage. So, when the time comes to file a claim, you may find that you inadvertently signed something that was not exactly in your favor. The fact that you do not fully understand what is and is not covered under your policy puts you at a disadvantage, and these companies are notorious for capitalizing on that.
These tactics are all very shameful and fall under what is known as "insurance bad faith". An insurance company is said to be engaged in bad faith activities when it fails to treat insured people in a fair and reasonable manner. This is a very serious wrongdoing, and you do have options for legal recourse. You need to speak to an attorney about your individual case, but in many cases, bad faith insurance companies may be liable for fraud or intentionally causing emotional distress. You may be entitled to recover punitive damages.
If you are facing difficulties with an insurance claim, contact the skilled and proven team at Coxwell & Associates, PLLC today at (601) 948-1600 for a free initial consultation.
Disclaimer: This blog is intended as general information purposes only, and is not a substitute for legal advice. Anyone with a legal problem should consult a lawyer immediately.