My claim was denied and my appeal was denied by the insurance company. What do I do now?
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UPDATED: Feb 20, 2013
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If you have a denied insurance claim, you may be in a difficult situation. If your insurance company has a valid reason for denying both your claim and your appeal, meaning, they have proof that they are not obligated to cover the situation in question, then you probably do not have much recourse at this point. If, however, you have carefully examined your insurance contract and you believe the insurance company is in the wrong in denying your claim, then it may be possible to continue the push forward with legal action.
Denied Insurance Claim: Understanding a Bad Faith Claim
All insurance companies have the obligation under the law to act in good faith, which means that they must live up to the contract they have with you, and pay for claims that fall legally within the bounds of the contract. These protections are necessary since consumers pay for insurance in the event that something will happen. The law must make sure that they are then paid if that something does occur.
Therefore, if your insurance company seems to be trying to avoid paying a claim for which they are contractually obligated, they may legally be acting in bad faith. You can move forward in such a situation by bringing a civil action for damages against the insurance company, on the basis of bad faith behavior. This may involve one or more charges of bad faith as well as charges of breach of contract.
The good news is that you can fight the big insurers and their legal counsel. Many attorneys who specialize in insurance bad faith will work for the insured on a “contingency fee basis.” This fee arrangement allows you to pursue your case and your attorney receives a percentage of any recovery or settlement. In some states, you may even be allowed to collect your attorney fees from the insurance company.
Many bad faith law firms will review your possible case, and even commence a lawsuit, without charge. It is difficult to successfully fight an insurance company without the assistance of an attorney because so many issues can only be effectively handled by an attorney experienced in insurance bad faith.
If you believe that your claim has been unfairly denied, or that the insurance company has been unreasonable while handling your claim, do not simply let it go. You should pursue your claim and assert your rights. You can fight and win. Talk to a lawyer who specializes in bad faith insurance litigation.