How to Respond to Refusal of Coverage by Insurance Company?

Unless the insurance company has a sound reason for the refusal, it could be trying to avoid making another payment. In that case, the target of the refusal could expect one of 2 different approaches by the insurance company.

Actions of company that has made a refusal in bad faith

• Deny the existence of the claim
• Commit a tort: evidence of that action could become grounds for seeking punitive damages

How the insurance company’s location plays a role in deciding what action should be taken against the relevant insurer?

The court studies the laws of the jurisdiction in which the insurance company operates. Those laws state the kind of damages for which the plaintiff must be compensated.

Types of damage awards for the victim of an insurance company’s bad faith decision

Compensatory: The compensatory award demands payment of the money that was expected by someone that has made a claim like the one that was presented by the claimant, the target of the refusal.

Consequential: This insists on payment to the plaintiff of any added expenses, beyond those that were already associated with the plaintiff’s original claim.

Punitive: If the court were to feel compelled to keep other insurers from sending a refusal to specific claimants, then it might elect to burden the defendant with the need to pay punitive damages.

Attorney’s fees: Not all jurisdictions allow a court to demand the payment of attorney’s fees by an insurance company that has been charged with carrying out a bad faith practice.

Approach to be taken by someone that has received a refusal from an insurer

Get the name of the state department that regulates the insurance industry. Working with an Injury Lawyers in Timmins, send a letter to that same department; explain what action the insurer took, in response to an honest claim.

After receiving any instructions from that department, follow them carefully. Consider using a lawyer’s assistance. Pay attention to any dates that have been included in later correspondence from the insurance agency. Do not miss a deadline, as that could keep you from obtaining the funds that you deserve.

Not every refusal has been made in bad faith.

Sometimes an insurance agency issues a refusal, because it has not received a sufficient amount of material. For instance, it has not been provided with documentation that can verify the claimant’s demands, with respect to lost salary.

If a claimant had not been honest with the insurance adjuster, then that could push an insurance company to issue a refusal of compensation. For instance, maybe the claimant had made an effort to hide the fact that he or she had sustained a pre-existing condition on the day of the reported accident.


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