How to dispute an insurance claim decision
Has your insurer rejected your claim or only agreed to cover part of your losses? If you feel you have been hard done by, there are some steps to take to dispute an insurance claim decision.
The first thing you should do when you receive a rejection, or an unsatisfactory outcome, is to ensure that you have been provided with clear reasons for the decision and to ask the insurance company for a review.
It is best if this is done in writing, so you have a clear record in the event you need to take further action. Be clear and calm. It’s only natural to be upset when you were expecting the insurer to cover your losses but try to take the emotion out of the situation and stick to the facts.
Ask for more details
An insurer might send a letter saying your claim has been rejected due to an exclusion clause or because you failed to disclose something. Whatever the reason they have given, ask them to provide more information in writing, including any reports from the assessor or other evidence that they may have used as the basis of their decision.
Just as the insurer asks you to provide details to back up your claim, you are entitled to examine their evidence to dispute an insurance claim outcome. Once you receive that information, you may decide that their reasoning is valid and decide not to dispute the insurance claim further.
Ask for a review
If the insurer’s reasons for rejecting the claim, or only paying part of the cost of repairs or replacement, do not match with your understanding of your entitlements under your policy, you might be in a stronger position to dispute the decision.
Ask for a formal internal review and explain why you believe you are entitled to one. For example, if you put in a claim for storm damage to the roof of your home and the insurer rejected it on the basis it was due to general wear and tear, you might have an independent builder’s assessment to back up your assertion that the damage was the direct result of the storm.
Provide more evidence
Sometimes when we submit a claim, despite our best intentions, we can leave out details that the insurer might consider important in the assessment process. That could be because we are shaken up, in the instance of a car accident or other traumatic event, or simply because we did not understand what should be supplied.
Now is the time to review the claim closely, with particular attention to the reasons the insurer has given for rejecting it. Consider what you might have overlooked at the time and gather any extra evidence to show the insurer you are entitled to have your claim covered in full. This could be a police report, in the case of a car accident, or some photos of items stolen in a break-in.
Seek expert advice
Just as insurance companies use assessors to determine the validity of an insurance claim, you can get expert advice, such as reports from independent building inspectors, to bolster your reasons to dispute a finding. This can come at a cost, so make sure that you are not spending more than a favourable insurance outcome is worth – it might be pointless to fork out thousands to chase hundreds of dollars.
If you think the insurer has done the wrong thing, such as cancelling your insurance policy without proper notification, or they are wrongly accusing you of doing something illegal, such as committing fraud, seek legal advice. The Insurance Law Service (ILS)Â at the Financial Rights Legal Centre provides free, independent legal advice to Australians.
Make a formal complaint
If the insurer refuses to conduct an internal review or provides an unsatisfactory response in that review, there are several ways to complain about an insurance company. They include lodging a formal complaint with the Australian Financial Complaints Authority (AFCA) or even taking the insurance company to court.
This can be a frustrating and time-consuming process, not to mention expensive. Why not let us take care of your insurance complaint and relieve those stress levels. Handle My Complaint is here to help.
