Insurance Companies: Tactics They Use To Minimize Payments or Deny Your Claim
A quick summary:
- Insurance companies will tell you not to hire a lawyer, in an attempt to keep you from knowing your full rights when it comes to compensation, as well as making it easy for them to run the clock on your statute of limitations
- They will tell you your damages are not covered under your policy, or offer you a low settlement in hopes you will just take their offer and move on.
- They may have you sign forms or releases that will cause you to unknowingly waive your right to compensation.
- They may say you’ve made a material misrepresentation, allege fraud, and could possibly rescind your insurance policy and deny responsibility to pay out benefits.
- Hiring an attorney can help you avoid the above, allowing you to navigate the process of making an insurance claim without the headaches of insurance companies taking advantage of you.
It is common knowledge that insurance companies will do a lot to avoid paying for someone’s claim. If you’re in an accident of any kind, from auto crashes to slip and fall, you will need to file a claim with your insurance. It is common to experience resistance from the insurance company on paying that claim. When you are trying to seek financial assistance from an insurance company, it is a good idea to hire an attorney to help you through the process.
Some Common Ways Insurance Companies Try To Avoid Paying Claims
A lot of the times, an insurance company will tell you not to hire an attorney. They know that the attorney will try to get as much money as possible for their clients. By telling you not to hire an attorney, they know that dealing with you directly will likely result in you just taking whatever they offer for compensation. Additionally, they may give you the run around for months. They’ll tell you that they’re in the process of reviewing your claim, effectively running the clock on your claim until the statute of limitations has passed. Once it has passed, they will deny your claim and you will have lost the ability to sue for the compensation you are entitled to. This is why it is important to hire an attorney from the get-go.
Additionally, insurers know that the average Joe likely does not know what their policy covers vs. what it does not. They know that you probably haven’t read up on what it covers, either, and thus will tell you that your policy doesn’t cover what you are seeking compensation for (injuries, bills, damages, etc.), relying on hopes that you won’t press the issue further and take what they say at face value. Make sure to always review your insurance policy, and understand what your coverage is. If you remain confused, seek the help of an attorney.
If it does get to the point where they offer you money for your claim, they will likely lowball you with an offer much lower than what you are entitled to. The figure they give could seem like a lot, but its unlikely to be what you fully need for your claim. They get away with this knowing that a lot of those who make claims aren’t informed on what their policy actually covers, as stated previously in the above paragraph. They know you need the money, and will count on their hopes that you’ll just take whatever they’ve offered because of that fact.
Another questionable way insurers will attempt to get out of paying on your claim is by tricking you into signing forms that could void your ability to get compensation, or inhibit your ability to get compensation. These forms may have fine print on them that if you sign, you could be unknowingly waiving your rights to any recovery or unknowingly admitting fault for a crash. This is another majorly important reason to hire a lawyer. Never sign any forms given to you by an insurance company after an accident without having an attorney review them with you. You may severely damage your ability to get compensated for your damages.
Suppose you are able to make a claim for an accident in Michigan regarding no-fault PIP benefits, with your insurer. They may then allege that you’ve misrepresented something when you applied for insurance, or misrepresented something involving the drivers in your household, or something about the vehicles listed on your policy. Increasingly this is being seen in Michigan, where insurance companies will say there was a material misrepresentation by their insured, and then argue that this constitutes fraud.
By alleging fraud, they will argue they do not have a responsibility to pay out any benefits. Worst of all, when they’ve alleged the material misrepresentation and fraud, they may void your entire insurance policy based on their assertions. When they’ve done this, they’ve effectively rescinded your entire policy, making it as if your policy never existed at all, and using that fact to declare they have no responsibility to pay your claim.
Insurance policies are contracts, and frustratingly, insurance companies have increasingly been able to get out of paying benefits since courts must follow the language of contracts. This means that if you’ve simply forgotten to include one piece of basic info on your car insurance, the company can get out of paying. In this situation it is imperative you hire an attorney and provide them with all insurance documentation, correspondence, e-mails, etc., so they can assist you in fighting the allegations made by your insurance company.
How To Deal With An Insurance Company After An Accident Claim
- Limit your interactions with the insurance company. Assume every call, e-mail, etc. is recorded and used when deciding your claim.
- Similar to the above, do not chat with the insurance adjuster. Their job is to find ways to avoid paying claims, not matter how friendly they may seem.
- Do not sign any forms or releases given to you by the company, without consulting an attorney first.
- Do not accept an initial settlement offer from the company, especially without knowing the full extent of your damages.
- Do not agree to give recorded statements without an attorney.
You should expect to be treated fairly by your insurance company, but oftentimes this is not the case. The insurance company will absolutely be looking for ways to limit the amount of money they pay out for your claim if not denying it outright. It’s important to retain an attorney once you’ve been in an accident, so you can successfully navigate the process of having your damages covered, with ease.
Have you been in an accident and are now dealing with shifty practices by your insurance company?