Individuals injured in car accidents often attempt to seek compensation from an at-fault party's insurance provider on their own by filing a claim against their auto liability insurance policy. While this process seems simple enough, many claimants are surprised when they receive notification that their claim has been denied and wonder, what should I do now?
If an insurance company denies your car accident claim, it's time to speak with an attorney about your case and learn more about your legal options. Here is a look at the action you and your attorney can take to seek compensation after an insurer denies your claim.
Why Do Insurance Companies Deny Claims?
Contrary to popular belief, insurance companies aren't in the business of paying out claims for the liability of their insured. They're in business to collect premiums. Because of this, when claims are filed, they assign a claims adjuster, an insurance company employee whose job consists of protecting the company's bottom line by only compensating claims if compelled. Even when they do pay a claim, they keep those settlements as low as possible.
An insurance company's claims department can deny a personal injury claim against the auto liability policy held by their insured because:
- The claim exceeds the limits of the policy. All liability insurance policies have a limit, the maximum compensation that can be provided per person, per incident. If the submitted claim's value exceeds these policy limits, the insurance provider will deny the claim.
- The insurance company believes that you were wholly or partially liable for the accident or that the accident occurred while you or the insured were violating state law, such as driving without a valid driver's license or insurance.
- The insurance company believes you failed to notify the police of the accident.
- You did not seek medical treatment immediately after the accident, indicating (to the claims adjuster) that your injuries were not as serious as you claimed they were.
- You have a pre-existing condition, and the insurer believes that condition—not an accident injury—is the reason for the pain and other symptoms you are experiencing.
Insurance Denied Your Claim? Talk to a Car Accident Attorney
While there are many legitimate reasons for an insurance company to deny a claim, insurance providers also deny claims for the wrong reasons, which constitutes bad faith.
In addition to denying a claim without providing an adequate reason to the claimant for the denial, other bad faith insurance practices that can impact you while seeking compensation after a car accident include:
- Failing to adequately investigate the claim promptly.
- Refusing to compensate a claim where liability is clear.
- Failing to render a decision on the claim in a timely manner.
When a legitimate claim is denied by an at-fault party's insurance company, obtaining compensation for the claim is still possible. An experienced personal injury lawyer plays an important role in turning a denied claim into a compensated one.
Most car accident lawyers offer a free case evaluation, where you can share the details of your accident with an attorney. The attorney can help you understand, based on the details of your case, your available legal options. They can also tell you more about their experience with claims like yours and the services they can provide to assist you as you navigate the court process.
Investigating the Claim
After you and an experienced car accident attorney start working together on your case, one of the first services they will provide is a thorough investigation of your accident. They will obtain and review the police's accident report, your claim against the at-fault party's insurer, the claim denial and reasoning, the policy details—including its limit—and additional information the insurer should have considered before rendering a decision on the claim.
The attorney will also determine if the value of your denied claim is correct. Often, those without experience in the law are unaware of the types of expenses and impacts they can include in a compensation claim.
Appealing the Decision
When an insurer decides to deny a claim, they must notify the claimant and provide a reason for the denial and instructions on how to appeal the decision. If you appeal the insurance provider's decision, you must submit evidence to show why their decision was erroneous. Your attorney can help you gather the documentation needed to prove your claim and represent you during the appeals process.
Filing a Lawsuit
Another option for seeking compensation after an at-fault party's insurer has denied your claim is to file a personal injury lawsuit. This legal action is filed in civil court within the statute of limitations for that type of claim. The statute of limitations is a legal deadline that states that the claim must be filed in court within a certain period for the claimant to have the right to use the court process when seeking compensation for their losses.
Most car accident claimants in Illinois have two years from their injury to file a lawsuit. However, many exceptions can apply to the statute of limitations, so consult a car accident attorney to determine how much time you have to file.
The court process is a legal consequence for insurance companies who fail to compensate claims fairly. If the statute of limitations expires and you lose the legal consequence of filing a lawsuit, the insurance provider will likely be unwilling to engage in settlement discussions.
An experienced car accident lawyer can track your claim's statute of limitations timeline and ensure you can file a lawsuit if necessary.
Communicating with the Insurance Provider
Whether through the claim appeals process or settlement negotiations after a lawsuit has been filed, your attorney will also manage communication with the insurance provider to protect your claim's value from insurer tactics to avoid big payouts. These tactics involve convincing or pressuring a claimant to accept a ridiculously low settlement offer or admit partial liability for the accident.
Gathering the Evidence Needed to Prove Your Claim
Evidence your attorney can gather for a car accident claim includes:
- Police reports,
- witness statements,
- medical documentation,
- information from your employer about your wages and your ability to work post-injury,
- information from medical or occupational professionals about the impact of permanent injuries,
- testimony from family or friends about your injury's impact on your life.
These are just some types of evidence that need to be gathered, considered, and organized to convince a reluctant insurance provider, judge, or jury that the accident happened as you said it did and resulted in expenses and impacts that justify the value of your claim.
Gathering this evidence can be overwhelming for an injured claimant to perform without assistance. Luckily, car accident attorneys have a team of legal professionals to assist in gathering and organizing the evidence that your attorney can present to the insurer or in court.
Negotiating a Settlement
Settlements are tricky. Once a settlement agreement is in place, you no longer have the right to go back and ask for more money if you discover that what you received was not enough to cover the expenses and impacts of the accident. Insurance companies commonly make initial settlement offers that are only a fraction of the claim's value.
An attorney can negotiate on your behalf, providing additional information to help the insurance provider understand the need to increase the offer to fairly compensate you and avoid the expenses and uncertainty of litigation.
Even though your attorney is negotiating on your behalf, the decision to accept an offered settlement is yours alone. Your attorney's role in that decision-making process is to ensure that you have the information and guidance necessary to understand how your claim is valued and what constitutes a fair settlement so that you can make decisions in your best interest.
When an insurance company denies your car accident claim for illegitimate reasons, you can generally seek additional compensation for bad-faith insurance practices. For example, Illinois's bad faith insurance laws allow the claimant to seek the value of the wrongfully denied claim and additional compensation for economic losses due to the denial, attorney fees, and if the insurer had an evil motive and outrageous indifference.
Once compensation has been agreed to through a settlement or ordered through a court decision, your attorney will assist you in receiving the compensation. Often, healthcare providers waiting for payment and group health insurers who cover the accident injuries place a medical lien on the compensation you receive. This lien is a legal claim to a portion of the proceeds and must be satisfied before you can receive the compensation.
Affording an Attorney
Many people try to resolve insurance claims on their own because they don't think they can afford the services of an attorney. It is little wonder, seeing how most people's exposure to court processes is based largely on television and movies, in which discussions of retainers and attorneys fees commonly occur.
In reality, personal injury lawyers who assist individuals injured in car accidents use a contingent fee billing method designed to allow anyone to obtain an experienced attorney's services when seeking compensation for the expenses and impacts of their injury.
The contingent fee billing method allows the claimant to wait until compensation is awarded for their claim to pay their attorney's fees. Clients sign a contingent fee agreement when hiring their personal injury attorney. This legally-binding agreement details the services the attorney and legal team will provide and designates a percentage of the compensation received through a negotiated settlement or court award as payment for attorney's fees.
At the conclusion of the claim, the attorney will receive the proceeds of the settlement or award on behalf of the client. Those funds will be placed in a trust until the attorney has negotiated any medical liens and deducted the percentage designated for their fee. They will then meet with their client to finalize the claim and turn over the remainder of the compensation to the claimant.
Did the at-fault party's insurance company deny your claim? Don't let insurance companies decide what you deserve for your injuries. Contact an experienced car accident attorney for your free case evaluation.