If You Have An Insurance Claim

Making a claim with your insurance company can be a bewildering process. It sometimes seems to take forever for an insurer to adjust (investigate) the claim. Inexplicable delays often follow. Phone calls to the insurance company seem to yield no information or action. Finally, an official letter from the insurance company arrives, stating that your claim has been denied. The insurer may base the denial on such things as policy “exclusion” or a “non-covered peril,” or it may assert that the loss is less than your deductible. Often, the denial letter contains lengthy excerpts from your policy, The policy language is very difficult to understand.

What are your rights when you make a claim?

The answer is contained in a great body of California law. The answer is found in the California Insurance Code and many other statutes; the California Code of Regulations; and decisions made by California courts of appeal. It is not possible to itemize your rights and responsibilities, and those of your insurer, in this website. However, here are some important rules insurers must follow in first-party claims (claims for loss to your own property). These rules are not exhaustive, and paraphrased here:

• After you make a claim, the insurer must disclose all benefits, coverage, time limits, or other policy provisions that affect your claim.
• The insurer must tell you if additional amounts under the policy might be payable if you submit further proof of your loss. The insurer must cooperate with you and assist you in determining how much additional coverage may be available.
• The insurer may not deny a claim on the basis of your failure to exhibit property unless the insurer can document that it demanded to see the property and you refused, or that you failed to follow any other requirement of your insurance policy regarding the exhibition of property.
• Unless your policy specifies a time limit, the insurer may not require you to notify it of a claim within a specific period of time.
• The insurer may not ask you to sign a release that goes beyond the claim itself, unless it first explains to you, fully and in writing, the legal effect of the release.
• Unless you first negotiate a settlement with the insurer, or the insurer has agreed to pay the limit of your policy, the insurer may not issue you a check that pays only part of your loss and that contains language releasing anyone from liability.
• After you request information from your insurer about your claim, the insurer must respond within 15 days with a complete response, based on all facts known to it.
• Once the insurer receives notice of your claim, it must, within 15 days:
  1. Acknowledge receipt of your claim;
  2. Provide you with all necessary forms, instructions, and reasonable assistance, including what you must give the insurer in proof of your claim; and
  3. Begin investigating your claim.
• The insurer must diligently investigate your claim. Its investigation must be thorough, fair and objective. The insurer may not hold up your claim by seeking information that is not reasonably required to resolve your claim.
• The insurer may not delay or deny settlement of your claim merely because another party may be ultimately responsible for paying for your loss.