When Your Insurer Says “No,” Fight!

Many people who have submitted insurance claims know the truth: Once you make a claim, the insurer may no longer be your good neighbor, on your side, or the “good hands people.” Insurance claims adjusters are trained to deny claims, and they are often overworked, so the easiest thing for them to do is say “no.” Unfortunately, some claimants give up, and the insurer keeps the money that they should have received. You should not be in that group without a fight!

First, hire a lawyer who specializes in insurance claims. Do not merely call the lawyer who handled your house closing, prepared your will, or helped you fight a traffic ticket. You need and deserve someone who has devoted years to battling insurers.

A good attorney will start with your complete insurance policy, including all endorsements and addenda. Sometimes the adjuster has misread your policy or failed to consider a recent change in the policy language. Do not merely bring the attorney a “summary of benefits” booklet. One of my clients saved hundreds of thousands of dollars because her health insurance summary differed from the governing master policy by a single, crucial word!

If the policy language is ambiguous, you will often win. In most states, language that can be reasonably interpreted in more than one way is construed against the insurer. The reasoning is that the insurer wrote the policy and had the opportunity to make crystal clear what it intended to cover.

Even if the policy language supports the adjuster’s denial, a good attorney will research the applicable law. Many states have statutes that invalidate certain policy exclusions. Also, the insurer might not have sent you the policy for which you applied. One of my clients’ multi-unit apartment buildings sustained severe fire damage (fortunately, no one was injured), and the client was dismayed that its policy coverage limit for lost rent was only $50,000 (the renovations took more than a year to complete, so the lost rent was much higher). However, when my client bought the building, the insurer had issued a binder (statement of future coverage) that listed $100,000 coverage for lost rent. After we filed a lawsuit, the insurer’s attorney called me and chuckled, “We’re not even going to file an answer. That binder crushes us!” The insurer not only agreed to pay the full $100,000, but under a state statute it had to pay my fee!

Don’t take your insurer’s denial lying down. Get the right attorney and go to the mat.

Jim Woods, Law ‘81