Insurance Policies and Claims

When you first purchase a life, health or homeowners insurance policy, you're probably not thinking about filing a claim. However, a smooth, straightforward and stress-free claims process is the mark of a good insurance company. Before you buy a policy or file a claim, learn about the claims process and how insurance companies determine whether to accept or deny a claim.

Understanding Claims

All insurance policies are designed to protect you against the expense of loss, whether it is damage to your home or auto, medical expense or the loss of the financial provider in your family. As large groups of people pay their insurance premiums over time, these funds are used to cover the losses of those who experience them. When you experience a loss and apply to receive compensation, this begins the claims process. When you file a claim, a claims representative or insurance adjuster works to see if you are entitled to compensation, and if so, the amount you'll receive. His or her job is to see that a settlement is reached that is fair to both you and your insurance company.

Why Insurance Claims are Sometimes Denied

Most legitimate and honest claims are paid. However, insurance claims are sometimes denied. This can be devastating on both a financial and emotional level if you are left with expenses you aren't able to afford. Some common reasons insurance claims are denied include:

• Expired coverage: Your policy may not have been in force at the time of your claim, due to unpaid premiums.

• False information: If you are not totally honest on your claim form, your claim can be denied.

• Inadequate coverage: Perhaps you only have liability coverage on your auto policy and have filed an accident claim, or your medical claim exceeds the coverage your policy provides for a specific treatment.

Tips for Getting Your Insurance Claims Paid

If you need to file an insurance claim, you can take steps to see that your claims are processed smoothly and successfully. Here are a few tips to help prevent your insurance claims from being denied:

• Be familiar with your coverage: Before filing a claim, make sure your policy is paid up and you are covered for that specific loss.

• Be honest and accurate: Even if you think embellishing your story will make it more convincing, just stick to the facts. If you are caught in a lie, your claim may be thrown out completely. Provide details that are as accurate as possible, and admit if you don't know something, rather than lying about it.

• File quickly: Some insurance companies have a time period during which a claim must be filed to be processed. Don't take a chance on missing the deadline.

• Keep records: Don't rely on your insurer or the police to keep track of your paperwork. Hang onto copies of all relevant documents including police reports and insurance/contact information of other parties involved in your auto accident or other insurance claim. Document all relevant conversations with your insurance representative, and evidence of your loss. Pictures and videotapes make excellent and convincing evidence.