Insurance Coverage Disputes

Denials of coverage by insurance companies for legitimate claims seems to be increasing. There are number of potential causes of this, not least of which are the significant increase in natural disasters such as wildfires, flooding, and earthquakes, which result in large insurance payouts, creating a need to save monies in other areas of the insurance business.  Whether insurance coverage is for health, auto, property, or liability insurance, the money to pay for claims come out of the same proverbial “pots” and at the end of the day an insurance company is a business, and their goal is to make money.

Reasons Insurance Coverage Is Denied

One of the primary reasons insurance companies deny coverage for claims is due to policy exclusions. Insurance policies are contracts that outline the terms and conditions under which coverage is provided. These policies often contain exclusions, which are specific situations or types of damage for which the policy does not provide coverage. Policyholders may not be aware of these exclusions or may overlook them when purchasing insurance. However, when a claim falls within an exclusion, the insurance company will deny coverage and may be entitled to.  An example of insurance policy exclusion is pre-existing conditions for long-term disability insurance.  Pre-existing conditions are rarely covered by such policies and if a disability arises due to a pre-existing condition and insurance company would be within it's rights to deny the claim.

Another reason for denial of coverage is the failure to disclose relevant information during the application process. When applying for insurance, policyholders are required to provide accurate and complete information, so the insurance company properly understands the risks that they are being asked to insure. This information is used by the insurance company to assess the level of risk and determine the premium they will charge through an underwriting process. If a party seeking insurance coverage fails to disclose material information or provides false information, the insurance company may deny coverage when a claim arises.  An example of this would be a failure to report to an insurance company a history of heart conditions when applying for life insurance.  If an insured passes away but the insurance company then finds out they were never insurable in the first instance, this could lead to a denied claim. 

Insurance companies can also deny coverage if the claim falls outside the scope of the policy's coverage. In some cases, the language of the insurance policy may be ambiguous or subject to interpretation. Other times insureds may believe that their claim should be covered, while the insurance company may argue that the circumstances of the claim do not meet the policy's criteria for coverage or a simply clearly not included in the coverage in the first instance.  An example of this can be seen in critical illness insurance coverage.  Most people wrongly assume that critical illness insurance covers any and all types of critical illness.  The reality is that most critical illness insurance specifically lists what types of illnesses they cover and policyholders must meet those specific diagnoses to engage coverage under such policies.  This is also true for accidental death & dismemberment (AD&D) policies, which specifically list what is covered under the policy.

Failure to meet conditions and requirements under a policy can also result in coverage denial. Insurance policies often include conditions that an insured must meet in order to be eligible for coverage. In the case of property insurance, failure to take reasonable steps to protect a property from further damage after an incident could potentially lead to a coverage denial. Similarly, in health insurance, failure to follow recommended medical treatment could also result in a coverage denial, as seen in many mortgage protection policies.

There are a number of reasons insurance companies can deny coverage under a policy of insurance.  Sometimes this is caused by an act or omission on behalf of the insured.  Other times it can be due to an act or omission of an insurance agent or insurance broker, or the insurance company themselves may have just made a wrong decision.  If you have a legitimate insurance claim that has been denied through no fault of your own you’ll need an experienced lawyer to assist you in reviewing your policy, the denial and to help you move forward with a claim to get the insurance benefits you are entitled to.

Experienced Insurance Denial Lawyers

The experienced insurance denial lawyers at Taylor & Blair LLP have been fighting against insurance companies for over 30 years and can assist with denied insurance claims, including:

• Denied Disability Claims
• Denied Life Insurance Claims
• Denied Critical Illness Claims
• Denied Mortgage Protections Claims
• Denied Accidental Death & Dismemberment (AD&D) Claims
• Insurance Broker or Insurance Agent Negligence
• Group Disability Policies
• Individual Disability Policies

There are strict timelines in which you have to bring a legal claim against an insurance company for coverage, so make sure you contact the lawyers at Taylor & Blair LLP today for a free consultation.