What Is an Insurance Claim? Key Steps and How It Works
Insurance coverage is invaluable when you’re involved in an accident. With the right coverage, you can be compensated for medical expenses, property damage, financial losses, and other types of damages incurred in an accident.
To ensure timely compensation, it’s important to file your claim as soon as possible after the incident. Most insurance companies approve or deny claims within 15 days, so reporting promptly will allow you to know the status of your compensation sooner.
Keep reading to learn more about insurance claims and the key steps you should follow to file a successful claim.
Understanding an Insurance Claim and How It Works
An insurance claim is a formal request you submit to your insurer, asking for compensation for an event covered by your policy. For example, if you have comprehensive car insurance and your car is involved in an accident or stolen, you can file a claim requesting compensation for the loss.
When filing a claim, it is crucial to attach all necessary documentation that proves the loss. If it’s a car accident, you should include a police report and photos of the accident scene. Once you submit your claim, your insurance company will investigate to verify its validity before compensating you for the damages.
In some cases, the insurance company may deny the claim. This typically happens when there is insufficient evidence or if the claim is deemed illegitimate. If this occurs, you can appeal the decision in court with the help of a lawyer to pursue the compensation you deserve.
The Seven Steps of the Insurance Claims Process
Here are the seven main steps to follow when filing an insurance claim:
1. Notify Your Insurance Broker or Agent
As soon as you experience an event covered by your insurance, notify your insurance broker or agent. When speaking to your agent, provide your full name, physical address, and correct contact details for future communication.
Additionally, give them accurate information about the incident. For example, if it’s an auto accident, provide details about when and how the accident occurred. Since the agent will likely record your call, be mindful of what you say, as it may be used later in the process.
2. Document the Loss
While your initial call informs the insurer about the incident, you must back up your claim with evidence. This could include a police report, as well as photos or videos of the accident scene. If you received medical care following the event, document all hospital bills and medical records, including X-rays.
The more documentation you provide, the stronger your claim will be. If you’re injured and unable to gather evidence, ask a trusted person or lawyer to assist in collecting necessary documents. Having comprehensive evidence will greatly support your claim.
3. Protect Property from Further Damage
The insurance adjuster may take up to 15 days to visit the accident site for assessment. In the meantime, it’s your responsibility to protect the property and preserve evidence.
For example, if your car windows were broken in an accident, cover the vehicle to prevent further damage. You may also choose to store the car at a police station for safekeeping until the insurance adjuster has completed the assessment.
4. Coordinate with the Insurance Adjuster
An insurance adjuster will review the accident scene and send a report to the insurance company. The company will then assess the extent of the damage or loss and compare it to the information you provided. In some cases, the insurer may work with property appraisers, engineers, or contractors to obtain an accurate evaluation.
As the policyholder, it’s important to cooperate fully with the adjuster. Allow them to assess the property and answer any questions they may have. Ensure that you provide truthful information and seek clarification on any aspects of the process that you do not understand.
5. Claim Settlement
After the adjuster’s report is reviewed, the insurance company will determine the extent of the damage and present a settlement offer. Compensation may be provided as repairs or as a cash settlement, depending on the nature of the damage.
If the settlement involves repairs, the insurance company may work with your contractors or provide their own. In cases of injury, the insurer will offer compensation based on the estimated medical expenses you may incur.
6. Negotiation
If you are not satisfied with the insurer’s settlement offer, you can negotiate with the help of your lawyer. A lawyer can help file the necessary paperwork and negotiate for a more favorable settlement.
If the initial settlement offer is too low, your lawyer can request a higher amount and provide a justification. Should the insurer refuse, you may take the case to court for a better resolution.
7. Claim Closure
Claim closure is the final step in the insurance claim process. At this point, both you and the insurance company should have agreed on the terms of compensation. Once you have been fully compensated, the insurance company will officially close your claim.
Get Professional Help in Filing an Insurance Claim
Each insurance claim is unique, and the process may vary slightly depending on the insurer’s terms and the specifics of your case. For this reason, it’s advisable to seek the assistance of a qualified lawyer to guide you through the process.
A lawyer can help you gather evidence, compile the necessary documentation, and negotiate with the insurance company to secure fair compensation. When choosing a lawyer, look for someone with experience in handling cases similar to yours. This will improve your chances of receiving the compensation you deserve.
