When & Why a Car Accident Insurance Claim is Denied

Here are some common reasons an insurance claim may be denied, and what your legal options are.

When you are making a claim through your insurance after a car accident, you may be counting on the money coming in from that claim in order to pay your medical bills and other costs. Unfortunately, things don't always happen that way, and sometimes your insurance claim is denied. When this occurs, it is important to understand exactly why it was denied. Every situation is different, of course, but below are some common reasons that insurers give for denying claims. 

Reasons for Claim Denials

Some common reasons for insurance claim denials include:

The accident was avoidable

If you could have avoided the accident, or if you did something that led to or caused it, then you may have your insurance claim denied. This is especially true if the insurer believes that you did something that would render the policy coverage ineffective, like driving drunk at the time of the accident or letting an unlicensed driver use your car. If you find yourself in a situation in which the insurance company claims you could have avoided the car accident, it is best to talk to a lawyer since the insurance company's attorney may have interests that are directly opposite to those of your own. 

There was no complaint or treatment at the time of the injury

If you wish to claim that you got injured as a direct result of the car accident, it is imperative that you actually go and get treatment right away. Otherwise, the insurer may argue that the injuries didn't really happen as a result of the accident or that those injuries are not related or connected to the accident. If you have proof that you went to the hospital immediately after the accident and your injuries were diagnosed then, you will have a much stronger case than if you wait. Furthermore, if you delay, this may make the insurer believe that the injuries are made up or exaggerated to try to get a payout, since most people who are genuinely hurt do get medical care immediately. It’s unfortunate that some people with no means of paying for medical treatment may be viewed as “fakers” – because they avoided medical treatment, even when they needed it -- when they really have a legitimate personal injury claim, but it’s often a point of contention between the insurance adjuster and injured person.

Medical records don't indicate an injury/pain

If you don't have medical records that indicate that you actually suffered an injury, then your claim is very likely to be denied since you cannot prove you will be entitled to any damages.

Pre-existing condition

If you have a pre-existing condition, the insurer may argue that it was this condition that is causing your injury and pain, and not the accident. If your condition was worsened by the accident, you may still be able to get some compensation, but it can be hard to sort out and prove just what was caused by the accident and what extent of the injury was pre-existing. 

When a Denial May Be a Sign of “Bad Faith”

These are just a few of the most common reasons why claims are denied. If you receive a notice of denial, you need to talk to your insurance company as soon as possible to find out what went wrong with your specific claim and what you need to do to fix it. 

If you believe that none of these issues apply in your case, then the insurance company may be denying your claim in bad faith. This means that the insurer is not living up to its obligation to resolve your case as per the agreement with the insured – you or the other driver. See our article on tactics an insurance company might use to minimize your compensation for other ways an insurer may unethically prevent paying your claim.

When to Get Professional Help

When an insurance claim is denied, you should strongly consider speaking with a car accident lawyer. Your attorney can help you to talk to your insurance company, find out what the problem with your claim was, and fix that problem so you can get the benefits to which you’re entitled. If you choose to hire an attorney, you can expect him or her to work on a contingency fee. This means you pay no fees up front, but you agree to pay the lawyer a percentage of the settlement if he or she successfully handles your case. In cases of insurance denial, it’s absolutely worth the cost of legal representation.

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