Why Was Your Underinsured Claim Denied & What to Do About It?

If a driver with limited insurance coverage has injured you, and your insurer denies your underinsured claim, it can feel frustrating and confusing. After all, you got uninsured/underinsured motorist coverage for precisely this scenario.

But don’t panic. The Ohio personal injury team at KNR has compiled this guide to help you understand your rights and potential next steps if your insurance company wrongfully denied or undervalued your underinsured claim after a car wreck.

Underinsured Motorist Claims in Ohio

In Ohio, you can file a claim against your underinsured motorist insurance policy if the total damages to your car accident surpass the at-fault driver’s insurance limit. This coverage is your lifeline when the other party’s policy can’t fully cover your losses, mainly bodily injuries.

Here are some car accident damages and losses that can quickly exhaust their policy limits, making an underinsured claim necessary:

• Medical Bills: This is frequently the most substantial expense after a car accident. It includes your hospital stays, surgeries, medication, rehab, and ongoing medical needs for your injuries.
• Lost Wages: If your injuries prevent you from working or hinder your ability to work, you can claim your lost wages or reduced earning capacity.
• Property Damage: If your vehicle was damaged or destroyed, the costs of repair or replacement can be part of your claim.
• Pain & Suffering: This is the physical pain and emotional distress you suffered due to the accident and your injuries.
• Long-Term Disability: If your injuries result in long-term or permanent disability, the costs related to your disability, such as home modifications, assistive devices, and ongoing care, can be claimed.

When the total amount of these losses exceeds the at-fault driver’s insurance policy limit, having your own underinsured motorist coverage can help cover the remaining costs.

Why Do Insurers Deny Underinsured Claims?

Insurance companies are businesses that aim to minimize costs and maximize profits. Unfortunately, this can lead to the wrongful or premature denial of your underinsured claim, despite you being a long-time policyholder with valid losses.

Here are the common reasons your insurer may have denied your underinsured claim:

Delay in Reporting the Collision:

Insurers require prompt notification of an accident. A delayed report may be seen as suspicious or make it difficult to verify the facts. For instance, if you waited a few weeks to report the accident, the insurer may argue that it’s harder to investigate the accident scene or corroborate your account with other evidence.

Lapsed Premium Payments

Insurance coverage is contingent on regular premium payments. If you miss payments, your policy could be canceled. For example, if you got into an accident and haven’t paid your premium in a few months, the insurer may deny you due to a lack of active coverage.

Disputes Over Policy Coverage

Claims are regularly denied when the insurer believes a policy does not cover the damages you claim. So, if you have an underinsured motorist policy that covers bodily injury but not property damage, the insurer could deny your vehicle repair costs since it’s not under your coverage.

Value of Your Claim

Insurers also routinely dispute the amount claimed. This is especially true if it exceeds the at-fault driver’s limit. If you’re seeking $75,000 in damages, but the at-fault driver’s policy limit is $50,000, your insurer might argue that your losses are not as severe as you claim.

Lack of Proof

Insurers may require substantial evidence to approve claims. They may deny your claim if you lack supporting documentation, such as medical records, repair bills, or proof of lost wages. For instance, if you claim for a significant amount of lost wages but can’t provide payroll records or a letter from your employer, the insurer might question the validity of this part of your claim.

Understanding these potential reasons for denial can help you proactively provide timely, thorough, and accurate information when filing your underinsured claim.

What to Do If Your Claim Is Denied

If your claim is denied, it’s not the end of the word. The denial may be valid, based on a minor error, or resolved with some clarification. On the other hand, it could also be an act of bad faith, so you need to take the matter seriously.

Here is how you should approach the denial of your underinsured claim and some steps that may help rectify the matter:

Understand the Reason for Denial

Insurers are obligated to provide the reason for claim denial in writing. This could range from lapsed premium payments to insufficient proof of damages. For instance, if your insurer denies your claim citing inadequate medical evidence, you may need to gather more comprehensive medical records or obtain expert medical opinions supporting your injuries.

Seek Legal Assistance

An attorney with expertise in insurance law can be invaluable. They can help interpret the insurer’s reasons for denial, evaluate your policy, and guide your response. If your claim is denied because the insurer asserts that your losses aren’t covered, an attorney can review your policy language and argue for a more favorable interpretation.

Document Everything

Record all communication with the insurer, your medical treatments, and any other accident-related costs. For instance, if you’ve incurred costs for physical therapy or modifications to your home due to your injuries, keep all receipts and invoices as they can support your claim’s value.

Review and Respond

At KNR, our team will review your case, including the accident evidence, medical bills, and underinsured motorist policy. We will formulate a comprehensive response to your insurer’s denial. This could involve providing additional evidence, such as photos from the accident scene or statements from witnesses, to counter the insurer’s points of dispute.

Remember, a denial is just a bump along the way. It can be managed and potentially corrected with the proper legal assistance and evidence. Professional help from attorneys well-versed in insurance procedures can go a long way in guiding you through this process.

At KNR, our team can review your case’s elements, such as collision evidence, medical bills, and your underinsured motorist policy, and advise on the appropriate next steps.

What If You’re Still Denied: Appeals, Arbitration & Lawsuit?

If your claim continues to be denied after a well-considered response, you and your attorney should prepare for potential arbitration or litigation. Continually denying a justified claim against your insurance policy is a sign of bad faith. If this is the case, you can still seek a fair resolution by collecting the necessary evidence and constructing a compelling case for compensation.

Issues with your claim should be resolved through negotiating a settlement. If the situation remains unresolved, you can explore the insurer’s formal appeal process, which may involve binding arbitration where a neutral party reviews the case and makes a determination.

In extreme cases, when these steps don’t bring about fair and full compensation, you can initiate a lawsuit against your insurer for breach of contract, bad faith, or both. Ohio law allows you to sue for bad faith if your insurer refuses to treat you fairly or delays investigating your claim.

KNR Can Help

If it becomes evident that your insurance company is reluctant to pay your underinsured claim, seeking legal assistance is crucial. At Kisling, Nestico & Redick, we help you navigate the insurance process, manage the insurer’s red tape, and represent you at every step.

Call 1-800-HURT-NOW for a free initial consultation. There are no up-front fees, and you owe nothing unless you recover compensation. Let us fight for everything you rightfully deserve.