Top 10 Reasons the Insurance Company is Not Accepting Fault and Denying Your Claim

See the top reasons why car insurance companies don’t accept fault and deny accident claims. Don’t let the insurance adjuster have the last word.

You’ve got a lot on your plate after an accident, trying to recover from your injuries and get back to work. When the other driver’s insurance company denies fault or refuses to pay your claim, it can seem unconscionable.

Adjusters commonly deny insurance claims by shifting fault to the victim or arguing there is no “available coverage” for the victim’s injuries. Some of these reasons are legitimate, others – not so much.

Fortunately, you don’t have to take “No” for an answer. If you determine fault for the accident lies with the other driver, you can push back. Here’s where we unpack common reasons for accident claim denials and your options for pursuing compensation from the insurance company.

Top 10 Reasons Car Insurance Companies Deny Fault and Payment:

  1. Shared Blame for Causing the Crash
  2. The Accident Was Nobody’s Fault
  3. Passenger Assumption of Risk
  4. Questionable Victim Injuries
  5. Fault for the Accident is Unclear
  6. No-Fault Insurance Rules
  7. Expired or Lapsed Insurance
  8. Excluded Drivers Under the Policy
  9. Insufficient Coverage for Your Damages
  10. Insufficient Coverage for Multiple Victims

1. Shared Blame for Causing the Crash

Insurance adjusters are trained to process auto accident claims quickly, for as little money as possible. The adjuster’s year-end bonus often depends on how much money they save the company.

One of the most common excuses for the insurance company not accepting fault is to pin the blame on you, instead of accepting liability on behalf of their insured driver.

In Alabama, Maryland, North Carolina, Virginia, and the District of Columbia, if you share any fault for causing the accident they can deny your claim under the pure contributory fault rule. If you’re as little as one percent to blame for causing the accident, you get nothing.

Most states use modified comparative fault rules, meaning the insurance company can deny your claim if you’re equally to blame or more to blame than their insured. If you share less than half the blame, you’re eligible for a portion of your claim’s value.

Claims may be wrongly denied by insurance adjusters who inaccurately assign fault to injury victims. The victim might share a smaller portion of blame or none at all. After all, the adjuster is motivated to find a reason to deny your claim, so their opinion may be biased.

2. The Accident Was Nobody’s Fault

The other driver’s insurance company may deny fault by arguing that no one was to blame for the accident. Occasionally, police will respond to a traffic accident and decline to issue a traffic citation or provide their opinion of fault on the accident report.

If there was no obvious traffic violation, the officer may not cite either driver. For example, if the roads are dangerously icy or snow-covered, there was a sudden onset of dense fog, or if the other driver suffered a medical emergency while traveling.

All is not lost if the insurance company won’t accept fault for their insured, even when the police report doesn’t clearly assign fault for the accident.

Your own insurance company may pay for relatively minor injuries if you’ve chosen optional MedPay coverage. Similarly, your collision coverage should take care of your vehicle repairs. In either case, your insurer will seek reimbursement from the other driver’s insurance company for what they paid on your behalf, and any deductibles.

For more serious injuries, you’ll need a personal injury attorney to handle your claim. The other car insurance company is more likely to pay the claim when an accident attorney is involved, especially if there’s a chance you may resort to litigation.

3. Passenger Assumption of Risk

The legal doctrine of assumption of risk essentially means that the victim brought their injuries on themselves. A valid assumption of risk requires that the injured person knew they were about to engage in a hazardous situation and chose to do it anyway.

Insurance companies will deny injury claims made by drivers and passengers by asserting assumption of risk, depending on the circumstances of the accident. That doesn’t mean the insurance company’s decision is necessarily correct.

Allegations of assumption of risk often arise from accidents involving:

  • Drivers or passengers who weren’t wearing seat belts in moving vehicles
  • Drivers or passengers who weren’t wearing a helmet on a motorcycle
  • Passengers who chose to ride with an impaired driver

Example: Claim Denied for Assumption of Risk   

Daniel was home from college for the holidays and got together one night with three of his best buddies, including Chuck, who was driving.

The young men went to a local bowling alley, where they played all evening while consuming several pitchers of beer. Chuck drank less than the others, as he was planning to drive them home.

On the way home, Chuck lost control of his car on a slippery curve, slamming the vehicle into a tree. All four men were injured, including Daniel, who had to be cut out of the passenger seat and airlifted to the hospital. The other three were taken by ambulance.

At the hospital, Chuck was tested for alcohol and found to be just over the legal limit.

Daniel spent two months in the hospital, including weeks of rehab for a brain injury. Daniel’s family filed an injury claim with Chuck’s auto insurance company, demanding $100,000 for his damages.

The insurance adjuster denied Daniel’s accident claim, stating that Daniel was completely at fault for his injuries because he knowingly got in the car with a driver he knew had been drinking.

The family hired a personal injury attorney to handle Daniel’s injury claim. The attorney reviewed Daniel’s medical records, noting that his blood alcohol level was very high when he arrived at the hospital trauma unit.

The attorney prepared another demand to the insurance company. He explained that Daniel had every reason to believe Chuck would stay sober enough to drive safely. Witnesses said that Chuck did not appear to be intoxicated when the men left the bowling alley.

Further, the attorney pointed to medical evidence proving that Daniel was intoxicated when it came time to head home and was in no condition to accurately judge whether Chuck could drive safely. He did not make a “knowledgeable decision” to assume the risk of riding with a potentially impaired driver.

Realizing that Daniel’s attorney could make an excellent case against them if they went to court, the insurance company retracted their claim denial and paid the $100,000 policy limits to Daniel.

4. Questionable Victim Injuries

The insurance company might deny your claim if the adjuster believes your injuries are not related to the accident. The adjuster will argue that their insured is not liable for your injuries because your injuries weren’t caused by the crash.

Common reasons an insurance company will question injuries:

  • Delayed medical care: If you failed to seek medical attention immediately after the crash, or refused medical care at the scene of the accident, the adjuster may assert you weren’t injured in the collision.
  • Preexisting conditions: If your medical records reveal a preexisting injury or medical condition similar to your claimed injuries, the adjuster may argue that the car accident didn’t cause your injuries, so their insured is not liable.

Always seek prompt medical treatment after an accident, even a low-impact collision. You may have significant injuries that won’t become symptomatic for several hours or days.

If you delayed treatment, you or your attorney may be able to rely on evidence like witness testimony and your medical records to validate the cause of your injuries.

5. Fault for the Accident is Unclear

In some car accidents, it’s hard to tell who caused the crash. A perfect example is multi-car collisions, where there may be several vehicles involved. Each driver’s insurance company will likely blame the other drivers.

In a situation like this, your best option may be to file your injury claim with every other driver’s insurance company and wait for the companies to battle it out, probably in court. In the meantime, one or more of the insurers may deny your claim.

Be sure to notify your own insurance company of the crash. Your insurance carrier is bound to get multiple claims as well.

Unless you walked away from a multi-car accident with only a few bruises, you might need legal advice to get fair compensation.

6. No-Fault Insurance Rules

If you’re in an auto collision and live in a state with no-fault insurance laws, in most cases you won’t be able to pursue a personal injury claim against the other driver.

You are allowed to make a property damage claim against the at-fault driver’s policy.

In no-fault states, you must first file an injury claim under your Personal Injury Protection (PIP) coverage with your own insurance company. PIP covers reimbursement of your medical bills, out-of-pocket expenses, and lost wages, regardless of who caused the accident. PIP does not pay for pain and suffering.

You can file an injury claim with the at-fault driver’s insurance company if the cost of your injuries exceeds your PIP coverage, your injuries are disabling, or you otherwise meet your state’s “threshold” for injury claims.

The at-fault driver’s insurance company may deny your claim if they don’t agree that you’ve met the threshold. Injuries that are severe enough to exceed a no-fault threshold should be handled by a personal injury lawyer.

In states with traditional fault laws, you have every right to pursue the at-fault driver for your damages. If your losses exceed the driver’s insurance policy limits, you are legally entitled to sue the driver personally for the balance.

7. Expired or Lapsed Insurance

Your claim could be legitimately denied if it turns out the at-fault driver was uninsured.

Unfortunately, there are people out there driving without insurance. These may be drivers who had valid insurance coverage at one time, but their policies weren’t renewed, or the policy lapsed because they didn’t pay their premiums.

While it’s technically illegal to drive without insurance, in most cases the only penalty is a stiff fine or a suspended driver’s license.

You may not find out the driver’s policy was expired until after you file your claim with their insurance company. You may get a call or letter days after filing your claim stating there’s no insurance in effect.

Even though an at-fault driver may produce a seemingly valid insurance card, the coverage may no longer be in effect. There may have been an overlap between the time the driver failed to pay the policy premiums, cancellation for non-payment, and what the insurance card shows as the expiration date of coverage.

Your auto policy probably has uninsured motorist coverage for bodily injury claims and might also have coverage for vehicle damage. Your other option is to file a lawsuit against the at-fault driver, although it may not be worth your time if the person has no assets or income.

8. Excluded Drivers Under the Policy

A claim can also be denied if the at-fault driver was not covered by the policy. The insurance company may say that although the policy was in effect at the time of your accident, the at-fault driver was excluded from coverage.

Under most auto policies, if the policyholder lets someone drive their car, they are covered under the policy by “permissive use.” However, insurance companies sometimes exclude high-risk drivers in the household from coverage.

If a household member has a suspended license, a bad driving record, or a history of DUI, they may be specifically excluded from coverage.

If your car accident claim is denied because the driver who hit you is excluded under the car’s insurance policy, you have a few options:

  • File a lawsuit against the uninsured driver
  • File a lawsuit against the policyholder who allowed an excluded driver to use their car
  • File a claim under your policy’s uninsured motorist coverage and let your insurance company go after the other driver or the car’s owner for reimbursement

9. Insufficient Coverage for Your Damages

Some drivers only carry enough insurance coverage to be legally allowed to drive in their home state. Each state has its own minimum mandatory insurance coverage requirements.

Sometimes unscrupulous adjusters try to pull a fast one on severely injured car accident victims when their claim value exceeds the at-fault driver’s liability coverage. If damages exceed the policy limits carried by the at-fault driver, the adjuster may deny the claim due to “insufficient coverage.”

Never accept a complete denial of your claim for “insufficient coverage.”

If the at-fault driver doesn’t have enough coverage to pay your injury costs, the insurance company should immediately “tender policy limits,” meaning they should hand over all the available coverage, even though it’s not enough to cover all your damages.

You’ll need a good car accident lawyer to not only get the policy limits from the at-fault driver’s insurance company, but to protect your right to pursue underinsured motorist coverage from your own policy, if applicable.

10. Insufficient Coverage for Multiple Victims

Similarly, if several people are injured in a crash, there might not be enough money to go around. Bodily injury liability insurance on auto policies typically has two tiers of coverage: per person and per accident.

If the at-fault driver’s policy has bodily injury limits of $50,000 per person and $100,000 per accident, it means no one person can get more than $50,000. However, there is only $100,000 for an accident, no matter how many people are hurt. If three people injured in a crash each have claims valued at $40,000 (totaling $120,000) there won’t be enough available funds to go around.

The insurance company may file an interpleader action with the court, essentially asking the court to decide how to divide the available funds among the injured claimants.

While not strictly a denial, you could end up with nothing if your injuries are not as severe as the other victims. You’ll need an attorney to argue for you in court and convince the judge why your claim should take priority over others.

 What To Do About Unfair Denials

Your claim may be denied for a legitimate reason, but don’t take the adjuster’s word for it. Whether you reside in a no-fault insurance state or a traditional fault state, if you feel your claim was denied wrongfully, you should meet with an experienced personal injury attorney to discuss your claim.

Severe injury claims should always be handled by an attorney. Insurance companies are notorious for taking advantage of badly injured claimants who aren’t represented by an attorney.

Most attorneys offer car accident victims a free consultation, and agree to work on a contingency fee basis. If your case goes forward, you won’t have to pay anything unless the attorney settles your claim or you win a verdict in court.

Insurance Company Denying Fault Questions

Charles R. Gueli, Esq. is a personal injury attorney with over 20 years of legal experience. He’s admitted to the NY State Bar, and been named a Super Lawyer for the NY Metro area, an exclusive honor awarded to the top five percent of attorneys. Charles has worked extensively in the areas of auto accidents,... Read More >>