Challenging a Denial of Insurance Coverage
Challenging an insurance company over a denial of coverage decision is likely to be high on a person’s list of things to avoid. Insurance companies are large and complex, and they use this structure to intimidate customers who need to file claims for issues such as property damage or medical care. In addition, the process to appeal a denial of coverage is often very convoluted and seemingly designed to frustrate customers so they give up. Given how insurance claim decisions are stacked in favor of insurance companies, hiring an attorney to challenge a denial of coverage is often the best chance a person has to get any money under the terms of the policy. In addition to hiring an attorney, the Florida Department of Financial Services also allows consumers to file complaints against insurance companies for unfair practices.
Getting an insurance claim denied goes against the peace of mind this relationship is supposed to provide. Thus, it is important to pursue legal action, if necessary, to ensure the insurance company lives up to its obligations. There are two methods that are primarily used to contest denial of insurance claims, and both will be discussed below.
The coverage a person pays a premium for is all based on the language of the contract that governs the policy, and when an insurance company denies a claim for auto damage, as an example, the company is basically saying that the terms of the contract do not require the company to reimburse the customer for the specific type of damage that occurred. Thus, everything rides on how the contract is interpreted, and when it appears the denial of coverage is contrary to the terms of the contract, a customer can file a lawsuit for breach of contract. The law does not permit insurance companies to use vague contract language in order to justify denying a valid claim, and courts will interpret such language against the insurance company. This means that if a plaintiff can present a valid interpretation of the contract, the claim should be covered.
In addition, a denial of coverage can be challenged based on mistaken facts. If the insurance adjuster (the representative that typically decides whether to approve a claim or not) denies a claim based on mistaken facts, even if the denial was made in good faith, the company may still be liable if that belief is later proved to be incorrect.
Bad Faith Claims
A second option that is available in certain circumstances, and would provide a legal claim in addition to breach of contract, is that the insurance company acted in bad faith when it denied the claim. Florida law requires insurance companies to act in good faith and in the customer’s best interests. If the company fails to do so, it could be liable for acting in bad faith. Essentially, claiming the insurance company acted in bad faith means the plaintiff believes his/her claim was improperly handled according to standard industry practices and/or Florida law. Examples of improper claim practices include:
- failure to fully and properly investigate a claim in a timely manner;
- using delay tactics to put off paying a claim, such as slow claim adjustment or information requests without providing reasons for the information sought;
- misrepresenting policy or coverage during communications with customers; and
- not paying the full claim amount.
Contact an Insurance Dispute Attorney
Trying to fight an insurance company on your own is likely to be a losing battle. They have full legal teams at their disposal ready to bury you in paperwork and complicated court hearings. The attorneys at the Miami law firm of Pita Weber & Del Prado can help level the playing field, and give you a real chance at getting your claim paid. Contact us today to have your case evaluated.