Here’s what you need to know if your car accident claim is denied. Don’t let the insurance company’s adjuster have the last word.
When a negligent driver causes a car accident, you expect their insurance company to cover your injury expenses, property damage, and pain and suffering.
You’ve got enough on your plate, trying to recover from your injuries and get back to work. What do you do if the other driver’s insurance company denies your claim?
Fortunately, you don’t have to take “No” for an answer. Here’s where we unpack common reasons for accident claim denials and your options for pursuing compensation from the insurance company.
Car Accident Claims Denied for Liability Reasons
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 tactics for denying or reducing an accident claim is to pin the blame on you, instead of accepting liability on behalf of their insured driver.
Pure Contributory Fault
In a few states, Alabama, Maryland, North Carolina, Virginia, and the District of Columbia, any blame that can be attached to you can justify a denial of 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.
Pure Comparative Fault
In states with pure comparative fault rules, you can pursue compensation from the other driver, even when you are mostly to blame. Your compensation would be reduced according to your share of fault, so if your claim was worth $10,000 and you were 80 percent to blame, you could still get $2,000.
Modified Comparative Fault
Most states use modified comparative fault rules, meaning the insurance company can’t deny your claim unless you are equally to blame (50% rule) or more to blame (51% rule) than their insured. If you share less than half the blame, you’re eligible for a proportionate share of your claim value.
Claims may be wrongly denied by insurance adjusters who inaccurately assign blame to injury victims. The victim might share a smaller portion of blame or no blame at all. After all, the adjuster is motivated to find a reason to deny your claim, so their opinion may be biased.
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.
One the way home, Chuck lost control of his car on a 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 they 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.
Denials Based on Questionable 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.
The most common reasons for the insurance company to deny liability for your injuries arise from:
- Delayed medical care: If you failed to seek medical attention immediately after the car accident, or refused medical care at the scene of the crash, 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.
When Liability Is Unclear
Some car accidents happen under circumstances that make it 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.
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 carriers may deny your claim.
Unless you walked away from the accident with only a few bruises, you might need legal help to get fair compensation.
Don’t let the adjuster have the last word on liability. Contact a personal injury attorney to protect your rights.
Accident Claim Denials for Policy Reasons
Claim adjusters commonly deny insurance claims by arguing there is no “available coverage” for the victim’s injuries. Some of these policy reasons are legitimate, others – not so much.
Never take “No” for an answer over the phone. Insist the adjuster send you a written explanation of the reasons your car accident claim was denied.
No-Fault Insurance Policies
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 insurance 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.
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, so long as you haven’t signed a full release of the at-fault driver as part of the settlement agreement.
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 to go after.
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 injury claim is denied because the driver who hit you is excluded under the car’s insurance policy, you have a few options for seeking compensation:
- 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
Claim Denials Based on Insufficient Coverage
Some drivers only carry enough insurance coverage to be legally allowed to drive in their home state. Each state has its 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.
Multiple Injured Victims
Similarly, if several people are injured in a crash, there might not be enough money 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.
Professional Help and Advice
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 won’t charge car accident victims for their initial consultation. 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.
It costs nothing to find out what a skilled attorney can do for you.
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