What are the Top Reasons for Insurance Denials in Illinois?
Dealing with insurance carriers is not on the top of anybody’s “to do” list. However, if you or somebody you care about has been injured due to the actions of somebody else, you will likely end up having to work with insurance carriers in order to receive compensation for your losses. Insurance claim denials are not uncommon, and they can happen for a variety of reasons. Sometimes, an insurance carrier will deny a claim for a valid reason. Unfortunately, there are also times when insurance carriers act in bad faith when denying a claim. Here, our Chicago personal injury lawyers want to discuss some of the top reasons for insurance claim denials in Chicago.
Valid Reasons Why An Insurance Claim May Be Denied
Insurance carriers are incredibly difficult to deal with, particularly when they are the at-fault party’s insurance carrier and may be on the line to pay a large settlement. In most situations, insurance carriers are going to do what they can to limit the amount of money they pay any settlement, and they may even deny a claim altogether. In some cases, an insurance claim denial is legitimate. There are various reasons why an insurance carrier may legitimately deny a claim, including the following:
- Unpaid premiums. If a person does not pay their premiums on time, this is a legitimate reason for an insurance carrier to deny their claim.
- Missed deadlines. Insurance carriers have fairly strict reporting deadlines that need to be met after an incident occurs. Failing to meet these deadlines could result in a claim denial.
- Claim not covered. An insurance carrier is not going to pay for any claim that is specifically exempt from coverage under the policy.
- Insufficient evidence. If there is insufficient evidence to prove an injury or other damages, the insurance carrier will be unlikely to tender any settlement offer.
Possible Bad Faith Insurance Claim Denials
Unfortunately, there are also times when insurance carriers deny claims in bad faith. To be clear, bad faith insurance practices are illegal under Illinois law, but that does not mean these denials do not occur. Some of the most common bad faith insurance claim denial examples include the following:
- Misrepresenting the terms of the policy. Every policyholder must understand the terms of their policy, but it is not uncommon for insurance carriers to purposely try to misrepresent which claims are covered and which ones are not.
- Failing to conduct an adequate investigation. Insurance carriers are required to conduct prompt and thorough investigations into every incident before they deny or accept a claim.
- Selectively reviewing evidence. Unfortunately, there are times when insurance carriers will selectively review evidence in a claim and then make their decision for denial.
- Falsely accusing a policyholder of insurance fraud. Insurance carriers sometimes falsely accuse the policyholder of insurance fraud in an attempt to get them to drop their claim. Any allegation of this type made without evidence is an example of bad faith insurance practices.
- Offering unreasonably low settlements. While it is not uncommon to make low settlement offers at first, continued and unreasonably low settlement offers could be examples of bad faith insurance practices.
Why You May Need An Attorney
If you or somebody you care about has sustained an injury caused by the actions of somebody else, contact an attorney for help dealing with insurance carriers. A skilled attorney can use their resources to investigate every aspect of the claim in an effort to obtain maximum compensation on your behalf.