Denied insurance claims

Denied insurance claims…

It’s the Xmas break and the last thing anyone wants to think about is insurance or worse an insurance claim being denied.

But it happens. It happens more than you would think.

Let’s be straight - insurers don’t want to pay claims if they can help it.

Especially if the claim is big money or there is something fishy to them…if they get a hunch, they will work at it, investigate tirelessly until BANG it’s wear and tear, non disclosure, maintenance, existing defect. You name it, typically a catch all exclusion or disclosure issue…

Let’s be clear, some insurers are better than others but when they don’t pay your legit claim they aren’t good.

And in many cases, with large claims, there is a reinsurer pushing buttons for a denial. You are not even talking to the decision maker!

So what can you do!

The usual response to a denial is to push back.

BUT first you want to see what the insurer is relying on to deny your claim.

1. Start by: Understanding the exact grounds and clause supporting the denial. If it is not stated you are entitled and should ask;

2. Next step: Ask the insurer for all documents, information and evidence (particularly expert reports) relied on to reach their decision. Do this preferably before seeking an IDR decision.

Remember an insurer needs to prove an exclusion and not you to disprove it.

Sure, putting forward another factual scenario or reason to argue against the denial is valid but you would be amazed how often we see a denied claim advanced at AFCA and yet there are documents the insurer has relied on that aren’t in the insured’s hands…

AND I will let you in on a secret, the Courts and AFCA don’t look at expert evidence in the same way.

AFCA will not scrutinise the independence of expert evidence in the same way a court will.

Basically your insurer could get its preferred repairer, builders or other ‘preferred’ party to issue a document to support its denial…

In fact that’s the Modus Operandi for how insurers get the evidence they want.

AFCA in my experience will still consider conflicted expert opinions, heck, if thy ruled them out they would basically be accepting the insureds position becuase i rarely see properly instructed independent evidence of insurers.

AND whilst AFCA will say they will reduce weight if evidence is clearly from a non independent source, that isn’t the same as Court, AFCA is really just a desk top look at things, there is no cross examination no scrutiny like you would expect of a Court.

My view is that insurers will game the system if they can. YOU need to narrow your lense as to what are the grounds, evidence and then make your decision on forum. AFCA or Court.

BU Lawyers routinely makes offers before Court or draft applications to AFCA that are more likely to succeed than running alone or with just a broker’s advice - this can often be one of the most effective ways to resolve disputes fast.

This article is a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Tagged as:

• insurance law