What Happens When There is a Claim?

Payment of claims is the reason that insurance exists, yet policyholders often perceive that insurance companies resist paying legitimate claims make the claims process unduly difficult. Both insurance companies and policyholders have contractual obligations which must be understood and performed to ensure the timely and satisfactory resolution of claims.

What can I do when an insurance company refuses to pay a claim?

In some instances an insurance company will refuse to pay a claim submitted by its policyholder. This is often referred to as “denying” the claim. The claim may be denied, for example, because the company has determined that the loss is not a type that is “covered” by the terms of the insurance policy or that the person who suffered the loss is not an “insured” for purposes of the policy or that a policyholder engaged in some type of misconduct which “voided” the coverage. Because of the complexity of insurance policies and because the resolution of coverage disputes often depends on careful analysis of the unique facts and circumstances of each case in light of applicable state law, the assistance of an attorney experienced in the handling of insurance coverage matters is strongly advised.

Insurance Claims and Damages:
If you’re successful in pursuing a claim against an insurer, what type of damages can you expect? The type of damages available will depend upon the claim you bring against the insurer. Obviously, dollar amounts will vary depending upon the injury, policy language, policy limits and the state in which you live, but there are some commonalities.

In a breach of contract claim, the insurance company is not honoring its promise to pay. In a homeowners’ case, if your home was destroyed by fire and they’re supposed to pay to rebuild it and don’t, obviously you’re entitled to the cost to repair or rebuild the home. So, depending upon what kind of insurance policy – that is – contract you have, you’ll be entitled to whatever benefits have been improperly denied.”

Bad faith takes it up a notch

A bad faith claim is a bit different. While insurers have a duty to deal fairly with policyholders and act in good faith, they sometimes don’t.  Bad faith is a tort. It’s not a contract claim. That means that the insurance company could be liable not only for the contract damages, but for additional damages that arise as a consequence of the insurance company’s bad faith conduct. Those damages, as in any tort case, can include all manner of consequential damages and emotional distress. For example, consequential damages in a disability case might include items such as house payments when the insured’s disability benefit is not paid. Other examples might include an insurer’s home being foreclosed upon or their credit being ruined. Those are consequential type damages that flow from the unreasonable denial of the benefit and from the commission of the tort.

Emotional distress can also be a factor.  The stress people are put under who are expecting the security, or the promise of security to be performed, can sometimes be enormous. That is also a compensable part of a bad faith claim. In some cases, I’ve seen people awarded millions of dollars simply for the emotional distress, the anguish that they are put through, sometimes for many years, by the insurance company and the processing of the claim.

How Can We Help?

After a loss, we maximize your insurance claim, which is the foundation for your successful financial recovery.

Many people don’t realize that the insurance company doesn’t automatically pay their insurance claim. Instead, it’s your responsibility to prove your claim in order to get compensated for a loss.

We can help by:

  • evaluating your insurance policy to establish the best possible strategy for presenting your claim to the carrier
  • valuing, documenting and substantiating every detail
  • negotiating on your behalf with your insurance company
  • keeping you informed every step of the way
  • ultimately settling the claim for the maximum amount and with infinitely less hassle for you

To Contact Us: 512-343-2572

Located At: 7719 Wood Hollow Drive Suite 200 Austin, TX 78731