Many insurance companies are becoming more strict about claims made by customers to prevent fraud.
While some insurers may delay payment in order to raise legitimate questions about claims, other insurers dither or refuse payment for no apparent reason.
These are the most common excuses that insurance companies use to deny or limit auto, home, and health insurance claims. Here’s how you can fight back.
AUTO INSURANCE
* “Your car doesn’t have the same value as you think it does.” Insurance companies base car-value assumptions on industry data similar to that found in Kelly Blue Book. Kelly Blue Book does not provide an average value of vehicles. Individual cars may be worth more or less depending on their condition and any added extras.
Examples: Your car could have been stored… have low miles… or have costly options such as a sunroof and a V8 engine.
You can use classified ads in the local newspaper to support your claim for a higher reimbursement. Find a few cars similar to yours that sell for more than the Kelly Blue Book value. Collect as much information as possible and send it to you insurer. Your insurer may relent.
* “Your car can be fixed for a lot more.” Insurers may set out to reduce claims payments by a certain percentage, even if the amounts are legitimate. Most insurers won’t openly admit to this. The company may instead say that the estimate of $3,500 was too high and that your car could be fixed for $2,500.
Be helpful: Don’t be intimidated. If you visited three repair shops and the lowest price was $3,500, your insurer should pay the entire claim. Don’t let your insurer pressure you into choosing a low-cost repair shop. I have never seen a policy that required policyholders go to a specific repair shop.
If your insurer continues to refuse, you can tell your attorney. The insurer may be willing to pay you. If there is a difference of a few thousand dollars between you and your insurance company, the company will pay more to hire a lawyer to represent you than to pay you.
HOMEOWNERS’ INSURANCE
*”The claim is due to past damage or normal wear and tears.” Insurers love to use this tactic to avoid paying.
Solution: Ask the company to show that they do not cover such claims. Ask the company where it states this. Ask for evidence that it was not “wear and tear” or other damage. The insurance company writes insurance policies. You can sue the insurance company if the language they rely on is unclear or ambiguous. The courts will rule that ambiguity is against the insurance company.
Example: A hailstorm damaged a Texas couple’s roof and window air conditioner. Although the company’s adjuster admitted that the air conditioner was damaged by hail, he insisted that the hail had not caused any damage to the roof.
They surveyed their neighbors to find out if other families had purchased new roofs. With this information, the couple called the insurer. The insurer reversed itself after realizing that the policy language of its company was identical to that of other insurance companies.
The typical homeowner’s policy covers the entire cost of replacing or repairing a roof damaged, regardless of its age.
*”You might fix or replace the damaged for less than what you claim.” This line is often used by insurers to test the limits of their claims payout before they make a decision. You can stick with your guns as long as you have a replacement insurance and can prove that it is impossible for an item to be replaced for the amount offered by the insurer.
* “We are delaying payment because of suspicious circumstances.” Your house was destroyed by fire. Now, the insurer is preventing payment due to questions regarding the cause of the fire.
It is one thing for payment to be delayed temporarily due to an investigation into arson. If arson is suspected the fire department will usually conduct its own investigation.
If the fire department doesn’t find it necessary to verify the origin of the fire in question, contact the company directly to see if they are accusing you for arson.
If you get a no, inform the insurance company that you expect the money to arrive soon. You can also tell your attorney about the matter. Call your lawyer immediately if the answer is “yes”.
Important: If you accidentally set off a fire, don’t panic. Every year, people set fire to their homes by smoking while asleep. Many companies offer compensation.
*”No receipts, no coverage”. It is best to keep a written inventory of all your belongings in your home.
Don’t worry if you forget to do this chore. You don’t need receipts for stolen or damaged items to be covered by homeowner’s policies. All that is required is that you can show proof that you own the item.
It’s a good idea to go through your family photos and look for images that include the items. Ask your family and friends for photos that show people grouped around certain furniture or paintings.
Get sworn statements from family members and merchants to confirm the existence of the items.
HEALTH INSURED
* “We won’t cover this because it isn’t necessary for medical reasons.” This is especially true for certain HMOs that can be extremely restrictive about the procedures they will cover.
It’s helpful to put pressure on the insurance company, starting with your doctor. Contact your employer’s benefits department and then contact the insurer. If that fails, you can contact your state’s insurance department or the media.
* “This treatment is not covered because it’s experimental.” It is possible for policies to be unclear about which treatments are standard and which are experimental.
It’s helpful to ask your doctor for assistance in defending your treatment.
Example: A Mayo Clinic patient suffering from migraines was recently denied coverage by an insurer because the treatment she received was experimental.
Her doctor also referred to the textbooks from his medical school, which described the treatment as “classic”. The treatment was routine in 49 states as well, he said.
The insurer reversed its decision.
* “We are not paying the whole bill because your doctor is charging too much.” Insurers won’t pay bills that are more than the “usual, customary” fees in an area. Because insurers are notoriously tight-lipped about this, it is difficult to determine what is normal and customary in your area.
It’s easy to ask your doctor for help.
Find out if your doctor performed multiple procedures, but charged you as if they were one. Clearing up the bill can often result in a higher payment from your insurance company.
Carson Danfield, an “Under The Radar” Internet Entrepreneur, has been quietly selling various products over the past 8 years. You may not have heard of him, but you might have visited his websites and purchased his products in the past.
