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What if the Other Driver’s Insurance Denied My Claim?
Understanding Insurance Claims in Illinois
Car insurance is a legal agreement between you and your insurance company. As a policyholder, you pay a premium, and in return, the company agrees to cover costs as specified in the contract. For instance, liability insurance covers the costs associated with an accident that you cause, up to the limits of the policy. In the event of an accident where you are the victim, you can make a claim against the other driver’s insurance company. You can request that they cover the cost of your medical treatment, vehicle repairs, lost income, and pain and suffering. However, the driver’s liability policy does not cover injuries they suffered.
What Is the Process of Filing an Insurance Claim After a Car Accident?
What is the insurance claim process for car accidents? Claims generally follow the same basic process:
File a Police Report
After an accident, you should call the police immediately. They will prepare a report containing all the details, including the date, time, location, and witness statements. The report will also mention the drivers involved, any injuries sustained, and the cause of the accident. This report plays a crucial role in insurance claims. If the police aren't present, you can file a report at a nearby police station.
Collect Documentation and Evidence
After a car accident, document the damage with photos or videos to support your insurance claim. Collect names, contact information, and insurance policy details of drivers, passengers, and witnesses. Take photographs of the scene and write a summary including information about the damaged vehicles and events leading up to the crash. Keep receipts and bills for medical treatment, repairs, and other expenses related to the accident.
File a Claim
To file a claim, collect the necessary documentation and evidence. You may be able to file online. Otherwise, you may need to contact an agent or call the listed number. If you were at fault, you make a first-party under your policy. You may also make a first-party claim if the other driver is underinsured or uninsured. For third-party claims, you file with the other driver’s insurance if he or she was at fault. Provide details such as the vehicles and drivers involved, a basic description of the accident, location and time of the accident, insurance information of the other driver, and other relevant information.
Investigation by the Claims Adjuster
Once you file a claim, the insurance company will assign a claims adjuster to investigate your case. The adjuster's duties include:
- Investigate the claim by collecting evidence such as the police report, witness statements, and photographs
- Assess the extent of your damages. The adjuster does this by reviewing medical records, inspecting your vehicle, and possibly consulting with specialists like physicians, mechanics, and lawyers
- Compile a report that outlines what caused the accident, who is at fault, and the extent of your damages
- Verify whether the insurance policy covers your claim and to what extent
- Negotiate a settlement for the amount the insurance will pay you to settle your claim
Once the report has been compiled by the claims adjuster, he or she will present you with an offer. You can either accept the offer or negotiate for a better one. To prepare for the negotiation, gather evidence to support your claim, including medical records, invoices, receipts, and any other relevant documentation. The stronger your evidence, the more leverage you'll have during the negotiation.
If you and the claims adjuster come to an agreement, he or she will authorize final payment, and you will receive it after signing a release accepting the offer.
Common Reasons for Insurance Claims Denial
Auto insurance claims may be denied for various reasons, such as the person is not covered under the policy, the vehicle is not listed, no policy in effect, exceeding coverage limits, preexisting injuries, or false information given to the insurer. There may also be policy exclusions, limitations, or disputes over liability.
Policy Exclusions or Limitations That May Apply
It is common for auto insurance policies to have specific exclusions listed, which are situations where the insurance company will not provide coverage. There are several types of exclusions:
- Catastrophic risks – These are risks that may negatively impact numerous policyholders simultaneously
- Intentional damage – If you intentionally cause damage, most insurance policies won’t pay
- Covered elsewhere – Risks are typically excluded from one policy if coverage is already provided in another policy
- Illegal actions – Insurance policies may contain clauses to void the contract if the insured tries to recover losses due to lawless or criminal behavior
- Maintenance issues – Typically, auto insurance does not cover damage resulting from wear and tear due to everyday use of the vehicle
If the cause of your damage is specifically excluded from coverage in your policy, your claim will likely be denied.
Disputes Over Liability
It is not uncommon for insurance claims to be denied due to a liability dispute. There may be a situation where both drivers were partly at-fault, or liability is unclear.
If the other driver’s insurance insists that you are primarily responsible for the accident, it may deny your claim.
If you find yourself in this situation, hire an attorney to investigate your accident and prove liability on your behalf. Even if you are partially at fault for the accident, Illinois law allows you to receive partial financial compensation if you are less than 50% liable.
Is There Legal Recourse for Denied Claims?
If your claim has been denied after a car accident, you can contact a personal injury lawyer who can examine your case and advise you on whether your claim should have been granted.
Your lawyer may believe that the insurance company denied your claim in bad faith. Bad faith occurs when the insurer denies your claim without a valid reason or does not investigate the claim within a reasonable time frame.
In situations when the insurer was not acting in bad faith, your lawyer can review the reason for the denial as stated in the letter provided by the insurance company. If your claim was rightfully denied, but it's still a valid claim, a car accident lawyer can help you file an appeal.
IF you and your attorney believe that the insurance company has made an unfair or unreasonable offer to compensate you, or is acting in bad faith, your claim may need to escalate to the courts.
If your claim denial was valid, your attorney may recommend filing a lawsuit against the other driver directly.
Filing a Lawsuit Against the Other Driver
If you've been in a car accident, you have more options for compensation than just filing an insurance claim. You also have the right to file a personal injury lawsuit against the at-fault driver. Insurance exists to protect the other driver in case he or she is liable for your damages. However, you can still pursue compensation directly from the other driver if the insurance company rejected your claim on legitimate or even bad faith grounds.
In most car accident injury lawsuits, negligence is the basis of the claim. Negligence is when the driver breaches a duty of care to you, causing the accident and your injuries. Examples of negligence include speeding, texting, and driving while intoxicated. If the other driver caused your injuries and the insurance claim was rejected, you can file a lawsuit directly against the driver to recover compensation.
What Are the Benefits of Pursuing Legal Action?
After an accident, you may face various expenses related to the damage caused and the subsequent injuries. Someone will pay the expenses, whether it be the other driver, his or her insurance company, your own insurance provider, or you. Pursuing legal action against the at-fault party, or his or her insurer, protects you from shouldering the burden of these costs.
It is important to determine fault in car accidents and who is liable. If the accident was not your fault, you should not have to bear the burden of these costs. You may have grounds to file a lawsuit if you believe the other driver’s insurance denied your claim in bad faith.
If your claim was validly denied, but the other driver is at fault, you may be able to seek compensation through legal action against the other driver directly. After a denied claim, legal action may help you recover the costs incurred due to someone else's negligence.