Car insurance companies offer a lot of promises when selling you a policy but when it comes to submitting a claim some consumers often experience a payout significantly less than expected. Although this can be frustrating you have to understand every policy holder has a right to dispute an insurance company’s claim payout. Car insurance companies are for-profit companies and pay claims based on terms like depreciation schedules, replacement values and book value, which do not always correlate to the real world cost or your expectations of coverage. With respect to accounting sometimes the claim payout is fair but with some patience and a few extra steps its very possible for a driver to obtain 20 percent or more by disputing a claim payout.
The key word above is 'patience' since its not always an easy process when a claim dispute starts. However, many car insurance companies exist and you have a right to fight for what you deserve.
The first step to filing an insurance claim dispute is to read your policy and understand the process--especially the timeframe allowed for filing such a claim. Many auto insurance policies provide limited time frames to dispute a claim and some companies will avoid paying any partial claim until a full agreement is reached so you should be prepared financially to wait it out. Most claim disputes do not drag on for anymore than a couple months.
There are three steps available for filing a claim dispute:
Have an Independent Appraiser Value the Damages
Once a claim is submitted the car insurance company will send a claims adjuster out to evaluate the damage and write up a cost of damages. It's important to remember this insurance adjuster does not work for you--he is paid by the insurance company. Most insurance adjusters work to give you a fair claim amount but fair is not equal to maximum. Anytime when the damage is (a) significant or (b) you want to dispute the claim amount you must hire an independent insurance adjuster who will review your policy looking for the maximum amounts you are entitled to under the terms of coverage. Independent adjusters are often paid based on a percentage of the claim so they work hard to review your policy with a fine comb and then provide the paperwork or submit the report directly to the car insurance company for review.
Once the car insurance company reviews findings from both the company appointed adjuster and yours a more amicable discussion about getting a higher claim payout is usually started.
Should the review of an independent evaluation still not help a car insurance company raise your payout to the expected amount you possibly have the right to request mediation.Mediation is held by a third party not directly related or employed to either you or the car insurance company and this party will determine how much of a claim you are entitled. This process can often save a lot of time and money in legal costs for both parties however mediation is never binding.
Since mediation is not binding your last resort will be either (a) arbitration or (b) a lawsuit. Both of these options require personally hiring legal representation.The cost can be extremely high for legal counsel but depending on your claim can be well worth the price tag. Arbitration is binding and relatively quick while a lawsuit can drag on for years.
One thing for sure is when you decide to dispute an insurance claim payout and start the steps above a car insurance company will recognize you are very serious and can often bend much easier since every step of this process is costing them more money. If you are arguing over a $3,000 difference sometimes it makes more sense to simply pay the full disputed amount then engage in these steps.