Reasons Why Insurance Companies May Refuse to Settle a Claim
Posted on behalf of Lynch Law Firm on October 13, 2021 in Car Accident News. Updated on May 25, 2023
Most injury claims are resolved when the disputing parties can come to a mutual agreement to settle the case without the need for a jury trial. However, for this to occur, both parties may need to compromise, at least a little.
Unfortunately, insurers may not always be willing to make a fair offer or any offer at all. When this happens, it may be in your best interest to speak to our car accident lawyers in New Jersey to see how we may be able to help you recover the compensation you need.
Below, we discuss some of the most common reasons why the insurance company may be refusing to settle your claim.
It is important to note this is an issue that could affect a first-party or third-party claim. As New Jersey is a no-fault state, victims first seek compensation from their own insurance company. If their damages exceed the value of that insurance policy, they may be able to file a claim against the at-fault driver.
DENIAL OF A FIRST-PARTY CLAIM
Even though personal injury protection coverage is no-fault insurance coverage, claims can be denied for a variety of reasons.
For example, if you do not provide your insurance company with a comprehensive description of the accident, your claim might be denied. If you wait too long to report the claim, the insurance company may get suspicious and deny it, thinking the claim may be fraudulent.
Other reasons for denying a first-party claim include:
- Waiting too long to seek treatment for the injury
- Failing to keep accurate records of medical costs and other expenses
- Your policy does not cover something you are claiming
As these are no-fault claims, fault is not an issue. Unfortunately, insurance companies are still looking for ways to deny these claims.
DENIAL OF THIRD-PARTY CLAIMS
These are some of the most common reasons a third-party claim may be denied, or that the insurance company may not make a reasonable settlement offer.
LACK OF EVIDENCE
The insurance company has the legal obligation to thoroughly investigate every claim made against their insured drivers. This means that you, as the injury victim, have the burden of proving by a preponderance of the evidence that your damages are a direct result of the negligent actions of the insured driver.
If there is not enough evidence to prove negligence, the insurance company’s financial responsibility to cover your damages may be questionable and may lead to hesitation from the insured over whether to make a settlement offer.
For example, the insurance company may raise questions about their liability if you do not have the following to support your claim:
- A police report
- Evidence of property damage
- Medical records showing your injuries
- Witness statements to support your version of events
Remember you must prove a driver’s negligence is the direct cause of your damages. The insurance company is going to do everything in its power to try and blame your injuries on outside factors, such as pre-existing injuries or conditions.
LACK OF INSURANCE COVERAGE
The insurance company may be refusing to make a settlement offer if the person responsible for your injuries does not have enough insurance coverage or does not have insurance at all.
Insurers are only legally obligated to investigate and pay out claims for people who have active and in force policies with them. Therefore, if the at-fault driver lacks liability insurance or does not have high enough policy limits to cover the full costs of your damages, the insurance company may not be bound by the law to pay out your claim.
Most insurance companies have certain time limits for filing a claim after an accident and submitting the necessary paperwork to begin the legal process. If you fail to file your paperwork within the allotted time, the insurance company is not legally obligated to offer you a settlement, so they may refuse to do so.
Additionally, if you send information that is false or inaccurate, it may prompt suspicion of fraud from the insurance company, which could lead to them refusing to make a settlement offer until they have thoroughly investigated your claim.
GET HELP WITH YOUR CLAIM. CALL US TODAY
Even though most injury cases are settled out of court, there are some circumstances when the insurance company may be refusing to settle your case. Whether it is because there is questionable liability or an issue with the date of filing, our attorneys are prepared to help you stand up for your rights as an injury victim.
Speak to one of our experienced attorneys today to learn more about your legal options for pursuing compensation, especially when the insurance company is refusing to negotiate.
The consultation is free and there are no fees unless we win.
Call us today at (800) 518-0508 .