Auto Insurance Claims: Small Court, Big Impact?

Suing an auto insurance company is a tedious task, but it is possible. Small claims court is a good solution that many people overlook. It is a forum where you can explain your point of view and why you believe you deserve what you are seeking. However, there is a negative side to small claims court: there is no legal advice admitted in court. There cannot be lawyers, insurance adjusters, paralegals, clerks, etc. It will be you against the party that hit you, that is it. This makes it a little easier as you can explain your version of events in plain English. If you get a judgment, the other party must pay it, and if they have insurance, their insurance company will have to pay within 20 to 45 days, depending on your jurisdiction.

Failure to pay on a covered claim

When an insurance company refuses to pay a claim, it is important to understand the reason for the denial. It is common for insurance companies to deny claims, and they are used to dealing with angry responses. However, anger is rarely productive in getting them to change their decision. Instead, it is crucial to channel your emotions into action and seek legal help. An experienced accident injury lawyer can assist in reviewing your case and determining the best course of action.

In the context of auto insurance, there are several reasons why a claim may be denied:

• Issues with coverage, such as the policy not covering the specific circumstances, vehicle, or driver, or the policy having expired or been cancelled.
• Lack of cooperation from the insured or delays in reporting the claim.
• Suspected fraud or intentional acts.
• Questionable liability, where the insurance company disputes who was at fault for the accident.
• Disputed injuries, where the insurance company questions the severity or legitimacy of the claimed injuries.

When facing a claim denial, it is important to understand your rights and the applicable laws. In some states, such as Florida, there are specific claim handling standards that insurance companies must follow. Additionally, insurance companies must conduct a reasonable investigation before denying a claim.

If you believe that your claim has been wrongfully denied, it is important to take action. Here are some steps you can take:

• Gather evidence and documentation to support your claim. This includes police reports, medical records, witness statements, and any other relevant information.
• Contact the insurance company and request a written explanation for the denial. This will help you understand their rationale and identify any discrepancies or errors.
• Consult with a personal injury attorney who can guide you through the process and negotiate with the insurance company on your behalf.
• If necessary, be prepared to take legal action by filing a lawsuit against the insurance company.

Remember, insurance companies are in the business of making profits, and they will often try to pay out as little as possible. By understanding your rights and taking proactive steps, you can improve your chances of getting the compensation you deserve.

Failure to reimburse for all expenses incurred in fixing your car

If your insurance company refuses to reimburse you for all the expenses you've incurred in fixing your car, you can take them to small claims court. This is a common type of case in small claims court. However, there are a few things to keep in mind.

First, check the rules in your state about the maximum amount you can sue for in small claims court. In California, for example, the maximum is $12,500 for an individual suing an insurance company.

Second, you'll need to know the correct legal name of the insurance company and the name of their "registered agent for service of process", who will be notified of the lawsuit.

Third, be prepared to present evidence to the judge, such as invoices or estimates for the repair costs. It's a good idea to get multiple estimates to show that the costs are reasonable.

Finally, keep in mind that small claims court is a more informal process, and you won't have a lawyer representing you. However, it can be a faster and cheaper option than filing a lawsuit in regular court.

No response from your insurance company

If you have tried to reach your insurance company multiple times and they are ignoring your requests to reimburse you, you can sue them in small claims court. They will likely respond before the hearing date, but if they don't, a judge will determine if you should win your lawsuit and have a valid judgment against the insurance company.

Small claims court is a great way to resolve minor civil disputes without the need for a lawyer. It is faster and cheaper than regular court, and hearings are informal. However, it is important to note that there are limits on how much money you can claim in small claims court, and you must ensure that your case is suitable for this type of court.

Before filing a lawsuit, you must demand payment from the insurance company, usually by sending a demand letter. You should also be prepared to present your case in court, including any relevant evidence such as police reports, witness statements, and repair estimates. It is also important to keep detailed records of any correspondence with the insurance company and its representatives.

If you are unsure whether your case is suitable for small claims court or need help with the process, you can seek advice from a small claims advisor or a qualified attorney.

Wrongful denial of your claim

• Lack of coverage for a specific incident or damage. For example, if you only have liability coverage and you submit a claim for repairs to your vehicle after an accident where you were at fault.
• Missed premium payments leading to a lapse in coverage.
• Discrepancies in the details provided compared to police reports, witness statements, or the insurer's assessment.
• The insurer argues that you were at fault or that you have exaggerated the damages or injuries.
• Exclusions in the policy, such as "acts of God" or natural events.
• The policy has lapsed due to non-payment of premiums.
• Failure to notify the insurer in time, as specified in the policy.

If you believe your claim has been wrongfully denied, here are some steps you can take:

• Review the denial letter thoroughly and understand the reasons for the rejection.
• Gather relevant evidence, such as documents, photographs, witness statements, and police reports, to support your claim.
• Contact the insurance company and discuss the denial reasons with the claim adjuster. Provide additional information if required and inform them of your intention to dispute their decision.
• File a formal appeal if initial discussions do not yield results. Write a letter detailing why you believe the denial was incorrect and provide evidence to back up your claims.
• Seek external review if the insurance company still denies your appeal. Request an independent third-party review, where a neutral party will evaluate the insurance company's decision, and the insurer is bound by this decision.
• Consult with an attorney specializing in insurance disputes at any point in the process. They can guide you on the best course of action, including potential litigation.

Remember, insurance companies have an obligation to their policyholders, often referred to as a "duty of good faith and fair dealing." This includes acting fairly and honestly, providing timely and accessible communication, and promptly processing claims. If they fail to uphold these standards, it may constitute a bad faith practice, and you may have grounds for legal action.

Denying a claim without a valid reason

If you believe an insurance company is acting in bad faith, you may have grounds to file a bad faith claim. Successful bad faith claims can result in the court awarding you additional damages beyond your initial claim. This is a way to penalize the insurance company for their behaviour. In some cases, this may also include legal fees and interest on unpaid benefits.

Insurance companies have a legal obligation to their policyholders, often referred to as a "duty of good faith and fair dealing". This duty means that the insurer must:

• Act fairly and honestly towards its policyholders.
• Provide timely and accessible communication.
• Promptly process claims.

Any failure to uphold these standards might constitute a bad faith practice.

If your insurance claim has been denied, you can hire an auto accident attorney to fight the denial. A claim presented by a personal injury lawyer will usually be taken more seriously by the insurance adjuster. Your attorney might first draft a demand letter, which is a more formal claim for compensation. It is important to note that you cannot sue the insurer; you must sue the driver and owner of the other vehicle involved in the accident.

If the insurance company has a formal appeals process in place, this could provide your attorney with a platform for negotiation, which could potentially lead to a more favourable settlement. This may include the use of arbitration to resolve the matter.

Frequently asked questions