Car insurance provides you with a safety net. You have peace of mind because you know you won’t have to cover the bills on your own when the worst happens.
This is why we purchase insurance.
It’s surprising, then, to learn that insurance companies deny a significant percentage of their car accident claims. If this happens to you, it isn’t the end of the road. Here’s a guide to insurance claim denials — and what you can do if your insurer denies your claim. A car accident lawyer can help.
What Claims Can You File With an Insurance Company After a Car Accident?
Car accident victims can file different types of claims with the insurance companies of the parties involved.
Some of the most common claims include:
- Property damage claims to cover car repairs or the loss of a vehicle
- Medical expense claims to pay for accident-related medical costs
- Loss of income claims to tide people over if they need to miss work while healing
- Pain and suffering claims to compensate victims who suffer significant distress
Washington has mandatory minimum auto insurance laws that require drivers to carry policies for potential damages. But requiring insurance isn’t the same as making the claims process easy – it’s not.
Every type of claim requires extensive paperwork and documentation. To file successfully, you’ll need a nuanced understanding of what the insurer is looking for. An experienced car accident lawyer can help you.
What’s the Usual Claims Process for Car Accidents?
The claims process in Washington state after a car accident includes an investigation, fault determination, damage assessment, claims, negotiation, and, for successful claims, a payout.
Too often, however, a car accident claim doesn’t succeed—either the insurance company offers an unacceptably low settlement and won’t negotiate an increase, or it denies the claim altogether. If the settlement offer is too low and the insurance company won’t reconsider the amount, the claimant can either take that offer and walk away or file an appeal.
The recipient of a denied claim also has options. Due to the seeming finality of the word “denied,” fighting a denial can feel impossible. It’s not! It’s hard, but with knowledgeable legal help, success is possible.
Here’s how it works.
How Do Insurance Companies Decide Whether to Settle a Claim or Deny It?
After an insurance company receives a car accident claim, it decides whether to approve payment of the full amount claimed, approve only a partial amount, or deny the claim.
How do insurance companies make those calls?
What Goes Into Insurance Companies’ Payout Decisions?
When insurance companies evaluate car accident claims, they consider factors including:
- The policyholder’s coverage
- The extent of the driver’s and passengers’ injuries and damage to the car and other property
- Information resulting from the claims adjuster’s investigation
- Which driver was at fault for the accident
- The circumstances of the accident
- Whether there’s been a violation of the insurance contract
These factors can combine to influence the likelihood of claim approval or denial.
For example, consider the following hypothetical claim evaluations:
- Jane rear-ends John’s car at a traffic light. John’s car is damaged, and John suffers whiplash. John files a claim with Jane’s insurance. When the company examines John’s claim, the company finds that Jane’s liability coverage fully covers John’s medical and repair bills. The company also notes that the bills John claims align with the adjuster’s expectations. The company fully approves his claim.
- After the same accident, Jane files a claim under her own collision coverage for damages to her vehicle. However, the adjuster finds that the repair bills Jane is claiming are higher than expected. As a result, the insurance company only approves the part of her claim that matches the costs estimated by their adjuster — a partial approval.
- Jane also files a claim with her insurance company to cover rental car expenses while her car is in the shop after the accident. Her policy does not include rental coverage, so the company denies this part of her claim.
There are many factors at play in every auto insurance evaluation. Some are readily apparent. Others are not.
And not every car accident claim denial will make sense. If your insurance company denies part or all of your claim and you believe they’re wrong, you need to work with a lawyer to appeal at once.
Do Insurance Companies Ever Reverse Claim Denials?
Yes, insurance companies can reverse claim denials.
If you and your attorney believe that the insurance company wrongfully denied your claim, you can appeal. If you can present overlooked or new evidence to support your claim, they may reverse the original decision.
Appealing a denied car accident claim isn’t easy. It requires knowledge of the law and of the way insurance companies think and work. Your attorney will help you put together the strongest possible case and will guide you through the process.
Fortunately, you’ll rarely see a reversal once a car accident claim is approved. This only occurs when something egregious happens — for example, if the insurance company discovers fraudulent activity associated with a claim.
What’s the Difference Between an Unacceptable Offer and an Outright Denial?
So far, we’ve covered what to do if your claim is simply (if unfairly) denied.
What happens if your insurance company does approve your claim but issues you an offer that’s too low to be helpful?
Do I Have to Accept a Bad Offer?
You are under no obligation to accept a bad offer.
If you file a claim and the insurance company offers you a settlement that doesn’t adequately cover your accident-related expenses, talk to your lawyer immediately.
Accepting a lowball offer may seem like a quick way to get at least some of the money you need. As your bills start pouring in, you could even feel like you have to take the insurance company’s first offer.
But this is just a short-term solution. If you accept an unfair offer, negotiations will come to an end, terminating any chance you had at getting adequate compensation for your injuries and damages. Plus, you’ll have to cover the remainder of your accident-related expenses out of your own pocket.
Once you receive your settlement offer, you can appeal if it doesn’t meet your needs.
Take These Steps to Appeal a Denied Claim (or Inadequate Settlement)
Step 1: Get the Facts
You know you deserve compensation after your car accident. How could the insurance company not see that? The notification of denial probably comes as a shock.
Once you catch your breath, take some time to review the denial letter with a lawyer, who can explain the complicated language, and see if they can identify the insurer’s reasons. (Nerdwallet’s guide to car insurance terms can help.)
Then, get ready to act.
Moving quickly will be key, as will working with an experienced attorney who’s handled denial appeals before.
Step 2: Write Your Appeal Letter
Your attorney can write this letter for you. It can clearly explain the errors in the insurance company’s denial of your car accident claim. It should identify what the insurance company got wrong in its denial, and point to the evidence that shows it’s wrong. This evidence could consist of medical bills and reports, accident photos, eyewitness testimonies, auto repair estimates, or police reports.
Make your demand clear at the start and the end of the letter: The insurance company made a mistake when it denied your car accident claim and needs to reconsider its decision.
Step 3: File Your Appeal
Send your appeal letter and supporting documents to the insurance company. Your attorney’s can follow the insurer’s complex appeal instructions, which vary from company to company. If you submit your appeal by mail, get a tracking number so you can confirm receipt. If you submit it electronically, keep the email confirming its submission.
Keep copies of everything you send.
Step 4: Follow Up
Typically, insurance companies have about 30 to 60 days to respond to appeals.
Your attorney will contact the insurance company to check in on your appeal. If you do not receive a response within this time, talk to your lawyer about the next steps.
Can You File an Appeal by Yourself, or Do You Need an Attorney?
Don’t negotiate with insurance companies yourself — especially after a claim denial. Insurance companies are not interested in pursuing outcomes benefitting you, and they have armies of agents and lawyers focused on maximizing company profits and minimizing expenses. You need someone on your side who understands this world, especially when you’re recovering from the physical and emotional trauma of your accident and trying to manage your daily responsibilities.
An experienced car accident attorney can fight your denial by providing tailored guidance, helping you navigate the complexities of the process, and advocating on your behalf during tense negotiations. If you need to escalate your claim to a lawsuit, they can handle that, too.
Should You Sue the Insurance Company if It Denies Your Car Accident Claim?
To sue or not to sue?
You certainly can. (Washington law, for example, states that you can bring an action to recover damages if you’ve been unreasonably denied payment of benefits.)
Should you, though? Your attorney is the best resource for answering this specific-to-you question.
Here’s some information that may help put the choice to pursue a lawsuit into perspective.
The Most Strategic Time to File a Lawsuit
Going to court after the insurance company denies your car accident claim is the last (potential) step in the appeals process.
Appeal your appeal directly with the insurance company first. Best case scenario, this resolves your issue without litigation. If not, your appeal will become the foundation for your lawsuit. If your appeal fails or if the insurance company exhibits bad-faith behavior during the process, a lawsuit may be your next best strategy.
What Filing a Lawsuit Looks Like
Filing a lawsuit is harder than filing an appeal.
First, you’ll file a complaint in court. This will initiate a discovery process, where you and other involved parties will exchange and scrutinize evidence.
Then, there will be a trial. Your attorney will present your case. If the court decides in your favor, you’ll finally get the compensation you deserve.
Should You Sue? Pros and Cons
Still wondering if a lawsuit is the right move after the insurance company denies your appeal?
Consider these factors:
- Filing a lawsuit may result in a larger payout than the one initially offered by the insurance company.
- If the insurance company is engaging in unfair practices, filing a suit can offer you a platform to hold the company accountable.
- Lawsuits can be costly and time-consuming. Usually, however, your attorney will be paid out of your award if the judge or jury decides in your favor.
- Lawsuits can also be unpredictable. The outcome is not guaranteed.
Your trusted attorney can help you weigh all the factors in your case. If you’re ready to start a conversation with an experienced personal injury attorney, reach out today.
Your legal team will help you handle every part of your claim process, from helping you discover the basic facts about your accident to making difficult decisions, handling tricky negotiations, and dealing with any issue that arises – including appealing a denial or filing a lawsuit.
Allow your car accident legal team to provide the support you deserve as you and your loved ones heal after your car accident.
