Denied Claim? Here’s What You Need to Know

Monday, April 17, 2023

If you’ve ever had a home insurance claim denied, you know how frustrating and stressful it can be. A denial can leave you with unexpected expenses and unresolved issues. However, it’s important to understand the reasons why claims are denied and what steps you can take to dispute the decision. In this article, we’ll explore what it means when an insurance company denies a claim, what happens after a claim is denied, how to dispute a denied claim, and how The People’s Choice can help you in the process.

 

What does it mean if your insurance denies a claim?

A denied claim is when an insurance company refuses to pay for a claim that has been filed by the policyholder. The reasons for denied claims can vary widely, but some of the most common reasons include:

• The claim falls outside of the policy’s coverage
• The policyholder failed to disclose important information
• The policyholder did not follow proper claims procedures
• The damage was caused by an excluded event

It’s important to note that a denied claim is not the same as a rejected claim. A rejected claim is when an insurance company refuses to accept a claim due to a technical issue, such as a missing signature or incomplete paperwork. A denied claim is a final decision by the insurance company that the claim will not be covered.

The two main reasons for refusal are:

1. Coverage Exclusions: When the claim falls outside of the policy’s coverage, such as when the damage was caused by a flood and the policy does not cover floods.
2. Policyholder Misconduct: When the policyholder did not disclose important information, failed to follow proper claims procedures, or committed fraud.

 

What happens after a claim is denied?

After a claim is denied, the policyholder has the option to dispute the decision with the insurance company. The insurance company is required to provide a written explanation of why the claim was denied. If the policyholder disagrees with the decision, they can file an appeal with the insurance company or pursue other legal options.

During the dispute process, the insurance company may ask for additional information or evidence to support the claim. The policyholder may also choose to hire a public adjuster or an attorney to assist with the dispute. The People’s Choice offers services to reopen old, previously settled, or denied claims, and can provide valuable assistance throughout the dispute process.

 

How do I fix a denied claim?

If your home insurance claim has been denied, there are steps you can take to dispute the decision and potentially have the claim approved. Here are the steps to take:

1. Review your insurance policy: Make sure you understand your policy’s coverage and any exclusions that may apply to your claim.
2. Understand the reason for denial: Obtain a written explanation from your insurance company detailing the reason for the denial.
3. Provide additional evidence: Provide any additional evidence or information that may support your claim, such as photos or witness statements.
4. File an appeal: If you disagree with the decision, file an appeal with your insurance company.
5. Seek assistance: If you need help with the dispute process, consider hiring a public adjuster or an attorney. The People’s Choice can provide expert assistance with the dispute process and help you reopen old, previously settled, or denied claims.

 

How often do claims get denied?

Claims can be denied for a variety of reasons, but the frequency of denied claims can vary depending on the insurance company and the policyholder. According to a study by the Consumer Federation of America, insurance companies deny about 22% of all homeowners’ insurance claims.

The three most common mistakes on a claim that will cause denials are:

1. Not reporting the claim in a timely manner: It’s important to report any damage or loss as soon as possible after it occurs to avoid potential issues with the claim.
2. Lack of documentation: It’s important to document any damage or loss with photographs or videos and keep any receipts or invoices related to the claim.
3. Not following proper procedures: Insurance companies have specific procedures for filing and reporting claims. Not following these procedures can lead to a denial.

 

What is the difference between denied claims and rejected claims?

As mentioned earlier, a denied claim is when an insurance company refuses to pay for a claim that has been filed by the policyholder. A rejected claim, on the other hand, is when an insurance company refuses to accept a claim due to a technical issue, such as missing information or incomplete paperwork.

While rejected claims can typically be resolved with additional information or by resubmitting the claim, denied claims require further action by the policyholder to dispute the decision.

 

What causes a denial?

There are many reasons why an insurance company may deny a home insurance claim. Some of the most common reasons include:

• The damage is not covered under the policy
• The policyholder failed to disclose important information
• The policyholder did not follow proper claims procedures
• The damage was caused by an excluded event, such as a flood or earthquake
• The insurance company believes that the damage was caused intentionally or due to fraud

To avoid a denial, it’s important to carefully review your policy and understand any exclusions or limitations that may apply. It’s also important to follow proper claims procedures and report any damage or loss as soon as possible after it occurs.

 

What are the most common claims rejections?

The most common claims rejections can vary depending on the insurance company and the policyholder. However, some of the most common reasons for rejected claims include:

• Missing information or incomplete paperwork
• Lack of documentation, such as photographs or receipts
• The claim falls outside of the policy’s coverage
• The policyholder did not follow proper claims procedures

If your claim is rejected, it’s important to review the reason for rejection and provide any additional information or documentation that may be required. The People’s Choice can also assist with handling rejected claims and helping you understand your options.

Having a home insurance denial can be a stressful and frustrating experience. However, it’s important to understand the reasons why claims are denied and what steps you can take to dispute the decision. By carefully reviewing your policy, following proper claims procedures, and seeking assistance from The People’s Choice, you can increase your chances of having your claim approved. If you’ve had a home insurance claim denied, don’t give up. Contact The People’s Choice to learn more about our services and how we can help you reopen old, previously settled, or denied claims.