How do you dispute a car insurance claim?

If you’ve suffered damages or injuries in a car accident, it can be upsetting to get a settlement offer from your insurance company for less than the amount of your total damages and injuries. It’s even more devastating to have your claim denied outright.

Adjusters can give a variety of reasons to justify a claim decision, so you must make a strong case supported by documentation and other evidence. Here’s our detailed guide on how to dispute a car insurance claim.

Should you dispute a car insurance claim settlement?

First things first, read your policy. It’s always important to review and understand your car insurance policy whenever you make or dispute a car insurance claim. Your policy tells you what’s covered and the proper procedures to follow when filing and appealing a claim.

After you review your insurance policy, carefully review any determination your carrier has made about your claim. You can’t effectively dispute a car insurance claim if you don’t understand the basis of the adjuster’s decision. 

Here are examples of the different determinations an adjuster can make on a car insurance claim.

Claim Denial on Procedural Grounds

Was your claim denied on a technical ground, like the claims period expired? Did you let your coverage lapse or drive without insurance before the accident? Those kinds of claim determinations can’t be disputed because they are procedural.

Claim Denial for Lack of Coverage

It’s common for an insurer to deny an auto insurance claim based on a lack of coverage. If you only have liability car insurance coverage and get in a car accident, your provider may cover claims for other accident victims and their vehicles but deny your claims for property and injury damages. You must carry collision and comprehensive coverage to cover your damages.

Claim Denial Based on Fraud

Sometimes, claims are denied because the insurance company determined that fraud was involved in the accident, claim, or in applying for coverage. Before you dispute a claim denial based on allegations of fraud, you should consider consulting with a car insurance attorney.

Low Settlement Offers

Maybe your claim was approved, but the settlement check is insufficient to fully or adequately compensate you for your losses. It could be that the offer was based on inaccurate estimates or incomplete information. If so, the adjuster may increase the amount of your claim based on supplemental bills, estimates, and other documents proving your injuries and damages.

Whatever the basis for your insurance company’s decision, it can be found in the claim denial letter or settlement offer letter, so review it carefully. These documents might also identify additional information that could be provided to change the outcome.

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How to Dispute a Car Insurance Claim Settlement Check

The adjuster may have approved your claim and included an insurance check with the claim determination, but if you don’t think the settlement offer is fair and want to dispute the claim, then you should not cash that check.

If you get an insurance settlement check, chances are there will be language on the bill that the amount being given is a full and final payment. Your act of cashing the settlement check could be seen as accepting that amount in full satisfaction of all claims. You will have essentially given up your right to dispute the claim by taking the money that was offered.

It’s important to understand that adjusters have a range of settlement dollars available to offer on a claim. Your adjuster will always try to pay out a claim for the lowest amount of money possible and, in doing so, anticipates some policyholders to dispute the offer and try to contest the amount of the car insurance payout.

It’s okay to hold onto the check until the dispute is resolved as long as you keep it somewhere safe.

Get a Second Opinion on Auto Damages and Repairs

If you’re going to dispute the insurance company’s decision about your car insurance claim, you’ll need to be able to support your position. The support you need depends on the nature of your dispute.

For example, if you believe the adjuster made you an unfair settlement offer because it doesn’t cover all of the damages to your vehicle, you’ll need to get a second opinion on auto damages and the cost of repairs.

Another case could be that your automobile was declared a total loss, and you dispute the adjuster’s calculation of the car’s actual cash value. In that case, it’s important to have your own value comparisons to convince the adjuster to increase the offer. The Insurance Information Institute suggests turning to resources like Kelley Blue Book for comparisons that will help you to determine the overall value of your vehicle. You can also use other online tools to calculate total loss for car insurance. 

Write Your Appeal Letter

Your appeal letter is essential when disputing a car insurance claim. It’s important to clearly explain the nature of your dispute and provide supporting documentation to show the adjuster that your claim should be covered.

If you weren’t at fault in the accident but the claim was denied on fault grounds, your strongest evidence would be the police report and witness statements or affidavits.

When it comes to low-ball settlement offers, an adjuster will use its own estimates, which tend to be low. That’s why you have to provide your own repair estimates, replacement receipts, property values, medical bills and records, and lost wages calculations.

Without supporting documents, your adjuster won’t be able to calculate the right amount of property and personal injury damages or may wrongly deny your claim on fault grounds. 

Remember to adhere to the policy rules on formatting and submitting your appeal letter. You don’t want your dispute rejected because you failed to follow the proper appeals procedure.

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Give Proper and Timely Notice

The policy should explain the process for how disputes and appeals are handled. Typically, there are notice requirements that specify who, when, and how you are supposed to dispute or appeal a car insurance claim.

Make sure you notify the correct person or department. Simply calling or sending an email to your adjuster may be sufficient to engage in preliminary negotiations, but it may not be the proper way to file a dispute.

Also, be aware of and always follow any time requirements and deadlines. If you overlook or ignore deadlines, that alone can be a basis to deny your dispute.

When You May Need to Sue

The ultimate goal of disputing a car insurance claim is to have the claim approved and get fair and adequate compensation.

Most adjusters are open to negotiating a resolution of the dispute. It’s not hard to negotiate for a better settlement amount if you have your supporting documents to back up your negotiating position. If you don’t feel you can negotiate by yourself, you can engage a lawyer to negotiate on your behalf.

If you can’t settle the claim or your insurer continues to deny coverage, and you believe there are legitimate grounds, you may have to sue your insurance company. Keep in mind that lawsuits take a long time and are expensive, so assess whether it is worth it in the end before you file a lawsuit against your insurance company for how your car insurance claim was handled. 

Case Studies: Disputing Car Insurance Claim Denials and Settlements

Case Study 1: Claim Rejection on Procedural Grounds

John’s car insurance claim was declined on the basis of procedural grounds, specifically the expiration of the claims period. Despite undertaking efforts to challenge the denial through an appeal process, the rejection remained unassailable due to its adherence to established procedures.

Case Study 2: Claim Rejection Due to Inadequate Coverage

Sarah held liability car insurance coverage; however, her claim for property and injury damages was dismissed due to insufficient coverage. The absence of adequate coverage rendered it unfeasible to contest the denial.

Case Study 3: Claim Rejection on Suspected Fraudulent Activity

David’s claim was refuted by the insurance company on grounds of suspected fraudulent activity. Seeking legal counsel, he pursued an appeal to challenge the claim denial based on the allegations of fraud.

Case Study 4: Inadequate Settlement Offer

Emily’s claim was initially approved; nevertheless, the settlement amount proposed by the insurance company proved inadequate to compensate for her losses. To support her dispute and engage in negotiations for a more favorable settlement, she collated supplementary bills and estimates as additional evidence.

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The Bottom Line: How to Dispute a Car Insurance Claim 

If you dispute a car insurance claim, there are basic steps you can follow. Start with reviewing your policy terms and the claim determination letter. Make sure you understand the appeals process and the basis for the adjuster’s determination. 

Next, gather as much evidence as possible to support your appeal, including second opinions concerning your auto and personal injury damages. Submit your appeal letter and supporting documentation in a timely manner per your insurance company’s procedures.

If you’re unable to resolve the dispute or your appeal is denied, your only remaining option may be to sue your insurance provider. Before considering any legal action, you should consult with an insurance attorney.

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