Insurance Claim Denials

An unexpected claim rejection by your insurance company can be a massive setback in your recovery plans. Don’t give up if you feel there’s any chance that your claim was denied unfairly. There are steps you can take:

Compare Your Policy With Denial Paperwork

Insurers must provide written, policy-backed reasons for denials. Compare the reasons for denial with your policy to assess their validity. Look for specific exclusions or limitations matching the given reasons.

Request an Appeal

You can request an internal review by filling out an official appeal form. A new adjuster will be assigned to review your claim. A new pair of eyes might see your claim in a different light that benefits you.

Stay on top of your claim’s progress. Insurers might use this time to delay a potential lawsuit. Colorado has a 2-year limit to sue for bad faith insurance practices. Breach of contract claims have a 3-year limit.

Seek Outside Help

If you tried the first two steps but still can’t get anywhere, bring in an outside professional.  

A lawyer can negotiate with your insurer, subpoena documents, gather additional evidence, and file motions in court on your behalf.

Filing errors: Missing info or incomplete forms look suspicious. Double-check all details. 

Misreading policy: Know your policy well. Don't just guess what's covered. Review it carefully. Ask for clarification if needed.

Coverage lapse: Pay your premiums on time. Missing payments can cause coverage loss. 

Uncovered damage: Policies cover specific events. Damage outside this scope may be denied. For example: You have wind and rain coverage. But you didn't add flood coverage. Your insurer might deny flood damage claims.

Always check your forms. Know your policy well. Pay on time. Understand what's covered. Report promptly. These steps can help avoid claim denials.

Insurance providers act in bad faith when they try to renege on their obligations. This can include:

·  unreasonably denying claims,

·  delaying investigations, or

·  refusing to defend you if you are sued or potentially liable.

Colorado Revised Statutes § 10-3-1115 prohibits insurers from unreasonably delaying or denying claim payments.

Insurers must verify legitimate claims, promptly review policy coverage and limits, and investigate and determine loss causes. They should also request supporting documentation for claims and verify policy term compliance. If an insurer fails to engage in these actions, they may be violating state law.