HomeInsurance5 Cases Where the Insurance Company Won't Pay and How to Resolve...

5 Cases Where the Insurance Company Won’t Pay and How to Resolve Them

When debilitating situations occur, the stress of the situation can be more than just physical. In fact, instances such as lawsuits or car accidents come with various mental implications that can last a lifetime. Although the security of having insurance can provide relief, there are instances when their help is limited. In fact, many individuals experience situations where their insurance company doesn’t pay them at all.

While employment companies strive to provide the best insurance for their employees, often times they are forced to cheapen out on quality due to high insurance pricing. In addition, many individuals seek the lowest monthly price without truly understanding the limits of their insurance. When the unexpected occurs, and there is no coverage, this leaves many people stuck in an unfortunate situation. In order to avoid feelings of frustration and disappointment, let’s consider the five most common reasons why your insurance company may not give you the payout you expected.

Holistic and Alternative Methods

Individuals suffering from chronic illnesses have a wide variety of medical options to choose from. With modern research reaching its height, the means to reaching wellness are almost unstoppable. This means an increased demand for holistic and integrative practices. However, despite this medical liberation, many insurance companies don’t cover natural treatment options. Why is that?

Well, many medical researchers have not found conclusive evidence that support the validity of natural alternatives. Because of this, insurance companies avoid risking their brand for liability suits. One commissioner stated, “[Insurance and care companies] are concerned that their limited dollars be spent on care that has been shown to be safe and effective.”

What To Do About It

While changing the mentality behind nationwide companies may seem like an impossible feat, you can find alternative solutions to this problem. To begin, insurance companies like to see proof that the treatment you are receiving is valid. Therefore, providing a written prescription from your doctor to the insurance companies will help to prove your claim. Ask your doctor to provide the diagnosis, length of treatment, and his/her support of this alternative option. This may open the door for your insurance company to cover treatment.

The Information Provided is Incorrect

Although this may seem like a small mistake, miswritten information can be a heavy deterrent in individuals receiving the payout they deserve. Things as simple as typos on your birth date, material possessions, and misspelled names could lead to potential problems.

Often times mistakes made on important documents can result in the insurance being invalid. The company may use a simple mistake and turn it into as issue of potential fraud. They may believe you are misrepresenting yourself as a means to avoid possible repercussions. Since insurance companies typically want to save as much money as they can, they will use small misunderstandings as an excuse to dismiss your claim.

What To Do About It

The best way to avoid this situation is to carefully go over the information you have given your insurance company routinely. This will save you from having to deal with stressful correspondence should a mistake ensue.

If you notice that there is a mistake on your documents, consult with your insurance company immediately. By keeping them in the loop, you are protecting yourself from further damage. Unfortunately, issues of mistakes on important documentation may result in a nasty battle. If this should occur, it is best to consult with a skilled lawyer like those at Miller Public Adjusters to go over your case.

Intentional or Accidental Death

Unfortunately, situations of suicide are not covered by all life insurance companies. Because of this, many family members are left destitute. In addition, insurance companies may also deny claims for individuals who died while driving drunk or under the influence. One of the primary reasons why these deaths are not covered is insufficient proof. As subjective and cruel as this mentality seems, it leaves many families in mourning and struggling.

What To Do About It

When it comes to purchasing life insurance, it is best to purchase a policy that covers natural, accidental, and even suicide-related deaths. Some insurance companies offer payouts if the incident occurs within two years of holding a policy. Of course if matters escalate toward legal action, no matter where you are in the country, you’ll need to consider searching for a wrongful death lawyer in Dallas or Seattle for example. Most of the time, the insurance should be able to take care of it, but in each case the circumstances are different so you’ll need to bear in mind that this course of action could be necessary.

Missed Payments

When premiums are not paid or when policies have lapsed, insurance companies may refuse payouts should an incident occur. Although this can happen on any insurance policy, it impacts life insurance the hardest. Beneficiaries who had no idea regarding the missed payments may be stuck with a denied claim.

What To Do About It

If this occurs, ask the insurance company to provide proof of due date reminders, premium-due notices, or other forms of communication. Beneficiaries and policyholders have the legal right to be aware of previous warning signs. In order to combat this issue, make sure your address and contact information is updated should any changes happen. This way, your insurance companies are able to alert you to possible dates.

Policy Exclusions

Many policies use legal jargon that is unfamiliar to the untrained eye. Therefore, many sign the dotted line without really understanding their coverage. Certain policies exclude damage done or situational instances that are left unknown to policyholders. This can include physical or structural damage, court orders, or even limitations on certain automobiles.

Also Read: Know About the Best Life Insurance Companies in India

What to Do About It

One of the best ways to avoid misunderstandings is to read through everything prior to signing the document. Certain insurance representatives may only scratch the surface behind what your policy truly means. Therefore, ask questions related to your circumstances. If you are unaware of specific coverage, never be afraid to seek clarification. Often times contractual lawyers may accompany you if you have issues regarding your insurance policies.

Filing insurance policies can be a headache, especially when you are unaware of what you are actually getting yourself into. Instead of being left in the dark, do you utmost to understand the fine print behind your insurance policy. By keeping up-to-date with possible changes in your life and with the company, you can avoid the stress associated with insurance companies refusing to pay!

Ajeet Sharma, the founder of Financegab and a well-known name in the field of financial blogging. Blogging since 2017, he has the expertise and excellent knowledge about personal finance. Financegab is all about personal finance which aims to create awareness among people about personal finance and help them to make smart, well-informed financial decisions.


Most Popular