Common Reasons for Denied Claims

If you sustain an injury, perhaps in a vehicle accident or as a result of a property owner’s negligence, you may be able to recover compensation. The majority of personal injury claims that occur in New York are resolved not through settlements with an insurance carrier, but the reality is insurance carriers can make it difficult to recover compensation. Insurance claims after an injury can get denied for a variety of reasons.

Understanding Why a Claim May Get Denied

Some of the most common reasons why insurance carriers – especially in car accident claims – may seemingly legitimately deny a claim include the following:

1. Lack of coverage. The claimed event is not covered under the policy’s terms. This can occur if the policy explicitly excludes certain types of damage or incidents. For example, a homeowner’s insurance policy may cover a wide range of injuries except for dog bite incidents.
2. Policy lapses. At the time of the incident, the policy was not in force due to non-payment of premiums or cancellation, meaning there was no coverage. Sometimes, individuals are able to make a payment late and have their coverage backdated.
3. Late claim filing. Claims filed after the deadline specified in the policy can be denied. Insurance policies typically require notification of a claim within a certain timeframe. We encourage reporting claims to an insurance carrier within 24 to 48 hours after the incident occurs.
4. Incomplete or incorrect information. Claims that are submitted with incomplete, incorrect, or insufficient documentation or information can be denied. It is crucial to provide as much information to the insurance carrier as possible to limit the chance they will deny the claim.
5. Non-disclosure or misrepresentation. If it’s discovered that the policyholder failed to disclose important information or misrepresented facts at the time of application, claims can be denied. This includes inaccuracies in reported risks or previous claims.
6. Exclusions. Specific exclusions detailed in the policy apply to the claim. Policies often exclude certain perils, conditions, or behaviors (e.g., intentional acts of vandalism or violence).
7. Failure to mitigate damages. Policyholders are expected to take reasonable steps to prevent further loss (this is considered mitigation) after an incident. Failure to do so can result in a denial.
8. Investigation findings. The insurance company’s investigation may conclude that the circumstances of the claim do not qualify for coverage under the terms of the policy.
9. Policy limits exceeded. The claim exceeds the policy’s limits. Insurance policies will only pay up to the maximum coverage amount specified.
10. Violation of legal or policy conditions. Engaging in illegal/illicit activities or violating the terms of the policy (committing fraud, using the insured property for unauthorized purposes) can lead to claim denial.

Even if a claim denial seems legitimate, we strongly encourage you to reach out to an attorney as soon as possible. Not every claim denial by an insurance carrier is legitimate, but you may not know this by reading through the often complex denial letter sent by the carrier.

What You Can Do If Your Claim Gets Denied

If you or somebody you care about has been harmed due to the negligent or careless actions of another individual or entity in New York, but your claim gets denied by an insurance carrier, you need to reach out to an attorney immediately. A skilled personal injury lawyer will be able to examine the facts of your particular situation and help determine whether or not you have solid grounds for pushing back against the claim denial.