Why has your insurance company refused to pay your claim?

Posted Dec 31, 2018.
Insurance – something that most of us understand is important (and can sometimes be vital) but many of us resent having to pay for, especially if there is a problem or dispute when we come to make a claim on the policy.  Insurance cover is available for a vast number of risks, including compulsory car and vehicle insurance, house buildings and contents insurance, life and medical insurance, business insurance and many, many more. 

Reasons why your insurance claim may be refused?


Over the years, the insurance industry has developed a reputation for not paying claims, disputing the amounts involved in a claim or just making life difficult for claimants. Whilst overall this reputation is undeserved, there are still many situations where your insurer may refuse or dispute your claim. The main reasons include:

What you are claiming for is not covered by your policy
You have exaggerated your claim and are trying to claim for more than you should
Exclusion clause(s) in the policy which means that you can't claim for what's happened
Your cover is invalid because you weren’t truthful when applying for cover or failed to disclose something which may affect your claim (for policies taken out before 6th April 2013) OR cover is invalid because you carelessly or deliberately misled your insurer or withheld information (for policies taken out after 6th April 2013)
Your policy was not in force and ‘live’ when what you're claiming for actually happened
You have missed some of the installments of your insurance premium
You failed to notify your insurer about a change in your personal circumstances
You are in breach of certain policy conditions or you haven't followed the claims process correctly

Reasons why your insurance claim may be disputed or not paid in full?


Insurance companies may accept that you have a valid claim under the terms of your policy but not pay your claim ‘in full’. The main reasons for this include:

Your insurance company decides that you have put an unrealistically high value on your claim, and consequently will only pay you part of it
There is an excess to pay on the policy. An excess means that you are liable for the first portion of any claim up to the amount of the excess.
Cover limits in your policy which limit the amount you can claim for any one item
•You have under-estimated the total value of your claim and do not have enough cover in your policy to be able to claim for all your losses. This is known as being under insured.
What you are claiming for was old, and your insurer will pay you less than the cost of replacing it with a new item – unless you have a new for old policy. 
The information you provided to your insurer was incorrect or you deliberately  withheld information or misled your insurers when you took out, renewed or changed your policy, meaning that the insurer would have charged a higher premium.

How to resolve a disputed insurance claim?


If you feel that your insurer is not acting reasonably when dealing with your claim, either in refusing to pay out at all or by refusing to pay the full amount, the first thing to do is check your policy wording carefully to see if there is anything that supports their position and decision. If there is nothing in the policy, and you have had an unsatisfactory response when dealing with the insurance company directly, it may be worth seeking a second opinion from a solicitor.

Our friendly team at Bakers are expert in dealing with insurance companies. We help people resolve claims disputes and get correct claims settlement; all claims are handled on a no-win, no-fee basis and we do not charge any upfront or unexpected fees. You can contact us by email or ring us on FREE on 0800 731 7284.