Reasons Why Car Accident Insurance Claims are Denied
If you’re seeking compensation for a car accident, you should be aware that insurance companies can deny claims for a variety of reasons. Even if a driver was not at fault for a car wreck, their claim can still end up being denied. Five reasons why insurance companies deny car accident claims include:
1). Both Drivers Were at Fault or Liability Is Disputed
Understanding the terms and extent of coverage under an auto insurance policy is important for drivers and vehicle owners. If a driver was engaged in certain behaviors that voided coverage, the insurance company will likely deny the claim entirely. For instance, driving under the influence of alcohol or drugs, or texting while driving, will almost always void insurance coverage. In other instances, if a crash occurred when an unlicensed driver was using the covered vehicle with the owner’s permission, that claim would also likely be denied. Ultimately, if the driver of the vehicle violated the terms of their insurance policy, the carrier will not pay out the claim.
Intentional wrongdoings aside, if there is a question as to which driver caused the accident, the insurance companies involved may not agree on whose responsibility it is to pay the claims. If the impacted driver’s insurer believes it’s insured is not at fault, it will seek to hold the other driver’s insurance responsible for the claim. This can also happen with the other driver’s insurer, resulting in a back-and-forth dispute between the insurance companies that can leave those affected at an impasse.
2. A Medical Evaluation Was Not Done
Even if a driver thinks they did not sustain any injuries after a car accident, they should still obtain a medical evaluation immediately after the collision. This is because some injuries either won’t appear or won’t be felt until days or even weeks afterward. Without having a medical evaluation after the fact, it can be much harder to prove that the injuries were the result of the auto accident.
If a driver waits too long to have an injury diagnosed and documented to present to the insurance company, the insurer can dispute whether or not it happened in the crash, even in the case of a catastrophic injury. If the driver cannot prove an injury is due to the accident, the insurer could refuse to pay for their medical treatment.
3. The Claim Exceeds the Coverage Amount
A driver must ensure their auto insurance policy either matches or exceeds their overall needs. For instance, if a vehicle is worth $100,000 and an accident occurs with a driver that has $50,000 in coverage, the claim could potentially be denied unless the driver has additional coverage in place. If the damage exceeds the impacted driver’s auto policy limits, then the claim will be paid up to the policy limits or the insurance company could deny it.
4. The Insurance Company Wasn’t Notified in Time
Insured drivers have a responsibility to notify their insurance company soon after a crash. California residents must notify their insurer within 10 days of a car accident if anyone involved was killed or injured; or if the accident caused more than $1,000 in damage. If the insurance company is not notified within a timely manner, regardless of whether any injuries or fatalities occurred, the insurer could claim it did not have appropriate time to investigate the claim while the evidence was still available.
5. The Denial Was Made in Bad Faith
If a car accident claim has been denied but the insurer has not provided a reason why, the insurer could be acting in bad faith. Bad faith essentially means an insurance company is denying, undervaluing, or delaying a claim for unethical reasons. An insurer acting in bad faith has effectively breached its contract with the policyholder and could face legal consequences.
Insurance companies can act in bad faith if a claim has been denied for no legitimate reason if they make the process as slow as possible so the insured cannot move forward, or if they drastically undervalue the claim with no explanation as to why.
What to do if the insurance company denies your car accident claim
Grappling with an insurance company after a car accident is the last thing you want to be dealing with. While many claims can be processed and paid out without a hitch, just as many are denied – some with little to no reason why. If you or someone you know has been involved in a car accident and the claim has been wrongly denied, a car accident lawyer in California can review and explain your legal options. At Curtis Legal Group, our lawyers do not charge an upfront fee and we offer free comprehensive case reviews. Contact our office today for more information on how we can help you recover what you’re owed after a car accident.