Unfair Settlement Tactics By An Insurance Company? File a Complaint

What to do when the insurance adjuster takes an unreasonable stance on your personal injury claim.

Updated By , J.D.

Every state has an agency that oversees the insurance industry. And each of these agencies has a consumer complaint division that occasionally gets involved when a claimant is having trouble with an insurer. Intervention by the state agency is rare when it comes to individual insurance claims, but in this article we'll explain when and how to file a complaint (or just threaten to take action, in order to motivate the insurance company to take your claim seriously). We'll frame the issue as one involving a personal injury claim, but this information applies to most types of insurance claims.

When You May Want to File a Complaint

There are a few circumstances in which a complaint to a state department of insurance might bring some results, including when the insurance adjuster:

  • has refused to make any offer at all to settle your personal injury claim
  • has provided false or misleading information, or engaged in pressure tactics or other conduct you believe is unethical, or
  • has delayed making a settlement offer, and has refused to explain why.

On the other hand, don't file a complaint when the insurance company has made a settlement offer but you differ on how much your claim is worth. Instead, learn how to respond to a low personal injury settlement offer.

First, Mention the Prospect of a Complaint to the Adjuster

If your situation seems appropriate for a complaint to the state insurance department, the mere mention to the adjuster of your intent to file such a complaint might bring a new settlement offer. Even though the insurance department is unlikely to get involved, adjusters would rather not have such a complaint on file. Too many of these complaints can result in an insurance department inquiry, and individual adjusters do not want to have these complaints in their own personnel files.

Filing the Complaint

If mentioning the possibility of a complaint to the state department of insurance doesn't get any movement from the adjuster or supervisor, file an actual complaint.

Your first step is to call and find out exactly where to send your complaint and whether there is a specific form to use. Do an online search for "[name of your state] department of insurance," and find the agency's website. If you find there's a form, get it and use it. Otherwise, your complaint letter should include the following:

  • the date of the accident and names of people involved
  • a general description of your insurance claim
  • the insurance company's claim number
  • details of the difficulties you have had with the claims adjuster—delays, no fair settlement offer, improper settlement tactics
  • the number of conversations you have had with the adjuster and supervisors trying to settle the matter, and
  • copies of all your correspondence, including your demand letter, so the insurance department investigator will understand exactly what the claim is based on.

The quality, quantity, and speed of response from state departments of insurance varies greatly from state to state. In a few states, every complaint gets at least some attention from the department's consumer affairs office. In other states, however, your complaint may get action only if the office spots obvious and extreme improper conduct, or if it has received numerous other complaints about the same adjuster or insurance company.

What Your Complaint Should Accomplish

Your complaint to the state insurance department can accomplish several things. First, someone in the claims department of the insurance company other than the adjuster who handled the claim will become aware that there is a claimant who intends to do whatever it takes to get a fair and reasonable personal injury settlement, and that may inspire someone to take another look at your claim and come up with a reasonable settlement offer. Also, because a complaint with the state insurance department adds an extra layer of work for the insurance company, the company will want to try harder to settle your claim.

On rare occasions, an investigator for the state insurance department actually speaks in person to an insurance company on a claimant's behalf. This may get the insurance adjuster to make a more reasonable settlement offer. At the least, it will probably force an explanation of why the insurance company is taking such a hardline position, an explanation the investigator may pass on to the claimant.

Sample Letter to State Department of Insurance

The following letter should help you get started on your own complaint:

[Your name and mailing address]


[Department mailing address]

Re: [Claim number, date of injury]

To Whom It Concerns:

I was injured in an automobile accident on January 12, 20xx with Corrine Pass, who is insured by Pacific All-Risk Insurance Company. I notified Pacific All-Risk of the accident on January 14, 20xx. On April 22, 20xx, I submitted a demand letter, plus copies of my medical records and billing, to Pacific All-Risk for compensation for my injuries.

On May 28, 20xx, I received a telephone call from John McCarthy, a claims adjuster from Pacific All-Risk. Mr. McCarthy at first denied that Ms. Pass was at all liable for the accident. In a phone call of June 6, 20xx, Mr. McCarthy admitted that Ms. Pass had some liability for the accident and offered to settle my claim for $750, despite the fact that I suffered a broken wrist as well as back injuries and my medical bills were $1,250.

I have had six conversations with Mr. McCarthy and with John Taylor, Mr. McCarthy's supervisor, between June 6 and November 1, 20xx. They have made no other settlement offer and refuse to give any reason for their failure to make a reasonable offer.

I believe that Pacific All-Risk is negotiating in bad faith. I hope that you will investigate this matter and convince Pacific All-Risk to make a good faith offer of settlement.

Enclosed are copies of all correspondence between me and Pacific All-Risk, plus copies of documents supporting my claim.

Yours truly,

[Your signature]

[Your name]


This article and sample letter are excerpted from How to Win Your Personal Injury Claim by Attorney Joseph Matthews (Nolo).

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