You have legal grounds to sue an insurance company if they fail to honor the terms of or violate the insurance policy. Some of the common violations include not paying filed claims properly, not paying the claims in time, or making claims with bad faith. The upside is that there are several laws meant to safeguard consumers such as you, and it’s not unusual to see a policyholder suing their insurance provider.
It’s already taxing having to deal with the death of a person close to you, sustained injuries, property damage, or some other mishap. So, if you are having to fight with your insurance provider at the same time, it’s natural to feel devastated. Dealing with an insurance company can be difficult, that’s why many people choose to hire a lawyer in Houston that handles car accident claims.
Continue reading to find out more about how you can sue an insurance company for denying your claim or any other breach of contract.
Why an Insurance Provider May Deny Your Claim
An insurer can deny your car accident claim for an array of reasons; some may be legitimate, while others not so much. Here are some of the top reasons:
- Lack of coverage: The insurer might argue that your current insurance policy does not cover your claim. Look over the exclusion section in your policy to get a better understanding of what is covered. Ambivalence in the insurance policy will be judged in the policyholder’s favor, not the insurance provider.
- Application errors: An insurance provider might argue that you misrepresented some information in your original application, which technically nullifies your policy coverage.
- Claim errors: Review your policy to see the fine print when it comes to notifying the insurer of a claim. There are times the window can be as short as 24 hours.
- Insurance fraud: Submitting exaggerated or false claims amounts to insurance fraud, which comes with criminal and civil consequences.
- Bad faith denial: They obviously won’t say this is a reason, but an insurance provider may provide several justifications, encapsulated in confusing policy jargon. All these are an attempt to disguise the fact that they don’t want to do the disbursement.
When Can I Sue an Insurance Company for Denying My Claim?
Every insurance company has several obligations to its policyholders. They are expected to comply with the terms stipulated in the policy, avoid unscrupulous trading practices, and act in good faith. Their exact responsibilities vary from state to state, given that the insurance industry is primarily regulated at the state level. However, these duties need the insurer to refrain from:
- An insufficient and delayed investigation into the claim
- Refusal to pay a claim where liability is clear
- Failing to deny or approve a claim within a specified or reasonable timeframe
- Denying a claim with inadequate or no explanation for the underlying cause of denial
- Not defending you in a liability litigation lawsuit where at least one of the claims is covered under your policy
- Denying a claim under an application misstatement basis after the contestability period has long past
If you suspect your claim was denied unjustly and your insurance provider is refusing to budge, you should consider suing. If you believe your insurer is not being fair, you should also consider getting in touch with a local Houston car accident lawyer before the claim is denied. In most cases, the presence of a fellow insurance professional can help persuade the insurer to honor its responsibilities and make a fair settlement.
What Legal Action Can I Take Against My Insurance Company?
As mentioned earlier, every state has its case laws and statutes that regulate the insurance industry. That encapsulates the different types of lawsuits that can be brought against an insurance provider. Considering that your insurance policy is a contract, it’s permissible to take contract action for any breach in every state. The majority of states will allow a bad faith lawsuit. What’s more, you may have legal grounds to sue under your state’s unfair trade practice laws. Most states have statutes or codes pertaining directly to trade practices in the insurance field.
A car wreck attorney can explain the different types of damages available since every state has varying rules regarding the types of damages you can seek in a particular lawsuit. However, compensatory damages, like lost wages and medical expenses, are available in these sorts of suits. Alternatively, punitive damages can be on offer in some cases and may be restricted by state law or the courts.
Tips for Suing an Insurance Company for Denying Claim
If you’re thinking about suing your insurer, it will play to your advantage to prepare and keep detailed records. Ideas to bear in mind include:
- Make sure to keep documentation of any correspondence with the insurance provider and its associates. Keep the emails and take notes during phone conversations, including the date and full names of any representative. Remain calm and presume they are recording you.
- Keep your insured property records, including pictures and receipts of what is under coverage. After an accident, make sure to take a lot of photos of the damage to your car right away.
- Monitor expenses incurred, like attorney fees, repairs, lost wages, and medical costs. Ensure your record-keeping and assessments are on point.
- Select a Houston automobile accident lawyer who’s experienced in insurance lawsuits. Insurance law can be time-consuming, intricate, and expensive.
If you opt to pull the trigger and sue your insurance provider, this kind of documentation will assist your lawyer in presenting a solid case.
Don’t Go Up Against Your Insurer Alone
If you want to sue your insurance provider for not approving your claim or doing any other misconduct, you should consider enlisting a local automobile accident law firm to protect your interests. You’ve already dealt with the aftermath leading to the insurance claim and the headache of a stubborn insurance provider. Also, chances are the insurer will have their own team of attorneys who will be working round the clock to protect their client. Reaching out to an experienced car accident lawyer near you will level things up.