Insurance is meant to be a safeguard for when the unexpected or worst happens. Flood, car accidents, medical negligence, property damage, business claims, loss of life, injury and illness can all turn you and your family’s life upside down. So, what do you do if your insurance claim is denied?
With the information from this guide to rejected insurance claims, you’ll know exactly what to do next and who to call for help or advice. Even if you received an offer but you believe it is too low, you can use these steps to help dispute the amount the insurer is putting on the table.
What happens if your insurance claim is denied?
A rejected insurance claim is now always final. Your first step if your claim is rejected is to request a written explanation as to why your claim was not accepted, and any supporting evidence the insurer has to support their decision. It may be as simple as a form not being completed correctly, missing information or something more complex. Either way, speaking to a no win, no fee insurance claim lawyer in Queensland early on can help you avoid any future delays.
Why would an insurance claim be denied?
Insurers accept around 85 to 96% of claims made, depending on the type of insurance. So, while an insurance claim being rejected is uncommon, it’s not unheard of. Knowing why insurers often deny claims can help you make sure you’re following the process as best as possible to help avoid any problems.
The top reasons insurance claims are rejected include:
- The policy excludes the specific situation being claimed for.
- Conditions have not been met as outlined in the policy.
- The policy premiums have not been paid, resulting in cancellation.
- The insurer believes you have not disclosed information.
- Forms have not been filled out correctly or information has been missed.
- There is not enough evidence or the evidence provided does not support your claim.
- Deadlines have been missed for making a claim.
Most of these reasons may be disputed, depending on your situation. Again, having a lawyer who understands policy language and insurance processes can help you be prepared.
How to help prevent your insurance claim being rejected.
Some ways to help prevent your insurance claim being rejected include:
- Thoroughly reading and understanding your policy’s Product Disclosure Statement (PDS).
- Maintain and provide clean, detailed records, including photos, videos, receipts, witness statements, professional opinion and any other relevant information.
- Report the incident as soon as possible to avoid missing deadlines.
- Avoid admitting liability or fault.
- Be truthful and accurate with all information you provide.
- Fill out all forms to the best of your knowledge and ability.
Also making sure you keep your policy up to date and if your circumstances change will help you avoid any potential delays or rejection if you need to lodge a claim.
How to fight an insurance claim denial.
The exact steps to take if your insurance claim is denied can vary a little between types of insurance, with different bodies you can help escalate your concerns to. However, in general, the process will look a little something like:
1. Lodge a complaint to the insurer’s internal dispute resolution (IDR) department.
If your insurance claim is rejected or the amount being offered seems low, your first step is to lodge a formal complaint to your insurer’s internal dispute resolution (IDR) department. They can tell you why the claim was rejected and reassess your claim. After 30 days, if they do not approve your claim or delay the process, you can take the next step.
2. Escalate to the Australian Financial Complaints Authority (AFCA).
The next step if your claim rejection was not resolved by contacting the insurer’s IDR team within 30 days is to escalate your matter to the Australian Financial Complaints Authority. You may need to lodge with a separate body depending on the type of claim, however, the AFCA is typically your first call. They will assess your claim and insurer’s decision, and act as dispute resolution between you and the insurer or help with negotiations.
3. Take legal action.
After taking your rejected insurance claim through the insurer’s internal dispute resolution department and AFCA, if there is no positive outcome, you can pursue legal action. Taking a rejected insurance claim to court can be a complex process, although most insurance claims are settled out of court through negotiation or mediation. If you do wish to pursue legal action, it’s important to act as soon as possible to make sure you avoid missing strict deadlines.
4. Seek advice from an insurance claim lawyer.
Before you start to fight a denied insurance claim, it’s wise to speak to a lawyer who specialises in insurance matters. They know the language, processes and common problems to delay or deny claims, often helping to settle matters outside of court. As many insurance claim lawyers in Queensland offer a no win, no fee arrangement, you may also not need to have the money upfront to take the insurer to court or to dispute the matter.
How a Lawyer Can Help If Your Insurance Claim Gets Rejected
The job of an insurance claim lawyer is to help provide you with clarity and support throughout the claims or rejection escalation process. They will:
- Review and interpret your policy, claim and insurer’s response.
- Challenge the insurer’s decision on your behalf.
- Help you gather evidence, such as photos, expert witness testimony and more.
- Negotiate and represent you in legal action.
- Handle all paperwork.
- Liaise with the insurer.
It provides you with a smooth, transparent process while you seek a successful claim outcome.
What is a no win, no fee insurance claim lawyer?
When you are represented by a no win, no fee insurance claim lawyer, you do not pay for your legal fees unless your claim is successful. There may be some external costs you are required to cover after your claim is final, such as medical reports, court filing fees and expert reports, although these should be explained before you proceed. It gives more people access to professional legal support in their time of need.
If insurance denies your claim even after you have appealed…
Even if your claim is denied with your insurer, there may be other pathways you may be able to consider. Speaking with an insurance claim lawyer near you can help you understand your rights and potential pathways for pursuing compensation or payments to support you in your time of need.
Main Lawyers has three offices in Queensland on the Gold Coast and Brisbane. If you have questions about what to do if your insurance is denied, or need help fighting a rejected claim, we are here to help. Contact us today for a free consultation.
