Many of us rely on our cars, even taking them for granted. You might use it to get to and from work. Maybe you carpool for your colleagues, or drive your friend’s kids to school. Or perhaps you love the flexibility and freedom to head out on a road trip.
But accidents can (and do) happen. Fortunately, you have car insurance for when you’re involved in a crash, so you can file a claim and receive a much-needed payout to cover your losses. But what if your claim is denied?
Car insurance exists to provide financial protection, but merely having a policy doesn’t mean you’ll be covered, and insurers can deny claims for several reasons.
In this blog post, the team at Patino Law, a leading, 5-star rated personal injury firm in San Antonio and McAllen explains the most common reasons auto insurers deny claims and what you can do about it.
On this page:
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- You Were Intoxicated during the Accident
- You Filed Your Claim Too Late
- Your Accident Involved an Uninsured Driver
- Lack of Coverage
- Issues Proving Your Losses
- You Do Not Have a License or Insurance
- You Have Pre-existing Injuries
- You Are Partly Responsible for the Accident
- Your Claim Is Denied in Bad Faith
- How Do You Know If Your Auto Insurance Company Has Denied Your Claim?
- What to Do When Your Insurance Claim Is Denied
- Appealing Your Denied Insurance Claim Denial
- Going to Small Claims Court
- Claiming Against Another Party’s Insurance
- Filing a Personal Injury Lawsuit
Key Takeaways
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Why Can Auto Insurance Deny Your Claim? Common Reasons for Denials
Being in a car accident is stressful enough, let alone having your car insurance claim denied. Before deciding on the best action, it’s important to understand the insurance company’s justification for denying your claim. Reasons for a claim denial range from clerical errors and missed deadlines to policy technicalities and disputes over liability. If these situations sound familiar, our accident attorney can clarify your legal rights and explain your options.
What Happens When Auto Insurance Denies a Claim?
When you file a claim with your insurer, an insurance adjuster will be assigned to your case. They’ll investigate your claim to determine whether they should provide coverage and calculate your damages. During this process, they may also talk to witnesses, look at police reports, and ask for more information.
After gathering all the information they need from you, your insurance adjuster must give you a decision on your claim within 15 business days. If your auto insurer denies your claim, you’ll receive a claim denial letter in the mail citing the reason for the denial.
Steps to Take When Your Insurance Claim Is Denied
Having your Texas car insurance claim denied is frustrating, but the worst thing you can do is automatically assume it’s the end of the road and that you have no legal recourse.
An insurance claim denial is not final, and there are several steps you can take.
Firstly, though, it’s vital to understand what not to do when you receive a denial letter.
Do Not Take It Out on an Insurance Adjuster
It’s natural to feel annoyed and distressed after a claim denial. You may have been relying on a payout to settle your medical bills or provide for your family until you’re well enough to return to work, so having your claim denied can be frightening.
But losing your temper with an insurance adjuster won’t help your case. If you intend to challenge the claim denial, it pays to be courteous in your communications. Insurance adjusters frequently deal with upset and angry claimants who are dissatisfied with the progress or outcome of a claim, so remaining calm and being polite can go a long way and ensure you stand out for all the right reasons. If you can align yourself with an insurance adjuster, they may be more likely to consider the situation from your perspective, resulting in a favorable outcome.
Review and Understand the Denial Letter
When you receive a letter confirming your car insurance claim has been denied, you must review it carefully.
Note the reason cited for your claim denial and cross-reference it against your policy. If you do not have a copy of your insurance policy, ask your insurer to provide it.
You should also review the letter for information on what to do if you disagree with the insurer’s decision — there may be a specific deadline for appealing.
If the letter does not clearly state why the insurance company denied your claim, it may constitute bad faith practices, and an appeal could result in a judge ordering that the insurance company pay your claim in full.
Appealing Your Claim Denial
If your Texas car insurance claim is denied, you have the right to appeal. Appealing does not guarantee the insurance company will reverse the decision, but it does allow for your claim to be reconsidered.
Do not hesitate to contact your insurance company for clarification. Keep records of all correspondence with the insurance company. If you phone an insurer to request a reconsideration, follow up in writing to ensure a paper trail.
In your request, outline why the claim should have been honored, citing specific policies, clauses, and additional evidence. Be as detailed as possible, pointing out how each piece of evidence applies to your appeal.
Evidence can range from photographs or video footage of the collision and your injuries, statements from individuals who witnessed the crash, medical reports, receipts and estimates, expert witness testimony (including from medical and economic experts who can testify to the severity of your injuries and the financial impact of your injuries, respectively), and the accident report created by law enforcement.
Going to Small Claims Court
Small claims court allows individuals to sue a party for up to $20,000 in Texas. It is designed to be informal and easily accessible, so unlike in higher courts, parties frequently represent themselves, and cases tend to be heard and decided much faster — usually within months.
If your car insurance claim is worth $20,000 or less, it is worth considering this legal avenue. However, do not mistake the less formal proceedings and lack of attorney representation for an easy win — proceeding to small claims court is a legal procedure and, as such, you are responsible for:
- Filing the lawsuit — including completing all paperwork accurately, paying a filing fee, and “serving” (formally notifying) the insurance company
- Gathering evidence to support your case
- Presenting a compelling and persuasive argument to a judge.
Claiming Against Another Party’s Insurance
If your accident wasn’t majorly your fault, you can recover your losses from the liable party’s insurance. Under Texas’s modified comparative negligence laws, you can pursue compensation from another party’s insurance company as long as you were less than 51% at fault for the crash.
However, to claim against someone else’s insurance, you must prove they were negligent. This burden means you must establish four elements:
- The liable party owed you a duty of care (such as a duty to abide by traffic laws and drive safely).
- They breached that duty through their actions or inaction.
- Their breach directly caused your accident.
- You suffered actual damages (like medical bills, lost wages, and pain and suffering).
Fortunately, personal injury claims have the lowest burden of proof in our legal system. You only need to show it was “more likely than not” that the other party’s negligence caused your injuries — you do not need to prove your case by a greater weight of the evidence or beyond a reasonable doubt.
Various parties could be liable for your accident beyond another driver involved in the accident. For example, if your crash happened because of faulty brakes, you might have a claim against the vehicle manufacturer. If you were hit by a delivery driver or someone working for Uber or Lyft, you could claim against their employer’s insurance providing they were “on the clock” during the accident.
Rideshare accidents can be particularly complex because companies will only provide coverage if the accident occurred while the driver was in a specific “phase”, such as if they had an active fare during the accident. If they had completed a fare and were on their way to pick up another passenger, or they had closed their rideshare app to take a break, reduced coverage — or none at all — can apply.
Sometimes, multiple parties share fault, like when poor road maintenance combines with another driver’s negligence to cause your accident.
Your success in claiming against another party’s insurance depends on the strength of your evidence showing they were at fault. Police reports, witness statements, photographs of the accident scene, and expert testimony can all help establish liability.
If the other party’s insurance company denies your claim, offers a settlement that doesn’t fully cover your losses, or your damages exceed the at-fault party’s policy limits, you have another option: filing a personal injury lawsuit.
Filing a Personal Injury Lawsuit
Your other legal option is to file a personal injury lawsuit. A lawsuit can be worthwhile if you have a strong case despite the insurance company denying your Texas car accident claim.
There are several advantages of a personal injury lawsuit, including the significant compensation you could receive. A judge or jury can order the defendant to cover your economic damages (the tangible costs associated with your injury, including medical bills, vehicle repairs, and lost wages) and non-economic damages (compensation for the impact of your injury on your life, such as if you suffer pain, emotional distress, or loss of enjoyment because your injury prevents you from doing certain activities).
A lawsuit can also result in a punitive damages award designed to punish the defendant and deter similar behavior.
Filing a lawsuit also demonstrates conviction in your claim. Proving you are serious is not reason enough for taking this route, but it may help tip the scales in your favor. By showing you are prepared to go to court in what could be a lengthy and expensive process, the defendant may be more open to reevaluating your claim or negotiating a fair settlement to avoid potential reputation damage and the unpredictability of a trial.
As with pursuing a claim against another party’s insurance company, you can only go down this route if you are not majorly liable for the accident.
A Note on the Statute of Limitations
The statute of limitations is the time limit for filing legal action. The statute of limitations for personal injury claims in Texas is two years from the date of your accident.
Two years may seem more than enough time, but when you consider that you must file your initial car insurance claim, wait for a response, prepare an appeal, and, finally, decide to pursue a lawsuit, you may have little time left.
You also do not want to rush these steps. You should take the time to gather the right evidence, build a strong appeal, and consider the various implications of filing suit — including the emotional burden and risk that it won’t succeed.
If you do not file suit within two years of your accident, the court will throw out your case unless there are extenuating circumstances, such as if an insurance company acted in bad faith by consciously dragging out your claim so that you would not have reasonable time to challenge the decision.
When Filing a Lawsuit Might Not Be the Right Option for You
For all the advantages of filing a personal injury lawsuit, there are several drawbacks. Juries are unpredictable and could find in the defendant’s favor. If your claim was denied over a shared liability dispute, a trial could result in you being found majorly liable and having to pay compensation to another party.
Filing a lawsuit may appear to be the best course if your claim is denied because the responsible party did not have insurance and you did not have uninsured motorist coverage. However, even if you win your case, you may struggle to recover the compensation awarded — often, motorists do not have insurance because they cannot afford it, meaning they may not be able to afford a sizeable compensation judgment, either.
Why You Should Always Consult a Personal Injury Lawyer
We always recommend seeking legal advice when your car accident claim is denied in Texas. If you are considering small claims court, you do not need an attorney, but they can prove a valuable partner in making your case.
A dedicated car accident lawyer can review your denial letter, explain the legal jargon, and determine your chances of successfully appealing it. They can also explore your options for claiming against another party’s insurance, help you identify who those parties might be, highlight the evidence you need to make your case — and help you gather it — and liaise with the insurance company on your behalf.
Insurance adjusters are notoriously tough negotiators and may employ sneaky tactics to reduce liability and avoid paying a claim. But the best accident attorney — like our Dr. Louis Patino — is equally relentless. Hiring an attorney can turn the tide of your claim and successfully negotiate a settlement that fairly compensates you for your damages, ensuring you avoid the stress, uncertainty, and cost of going to court.
Of course, a personal injury lawyer can represent you in court if you choose to file a lawsuit. While there are never guarantees, we will clearly explain your options and your chance of success at trial based on our decades of experience trying similar cases.
A Quick Recap of What to Do If Your Car Accident Claim Is Denied
Here’s our quick four-step guide on what to do if your Texas car accident insurance claim is denied:
- Do not panic, and try to keep your emotions in check. Do not act rashly toward the insurance company or write your claim off as a non-starter. You may be able to pursue multiple legal avenues depending on your circumstances.
- Review your denial letter carefully, request additional information from the insurer, and record all communication.
- Consider appealing the decision, heading to small claims court if your claim is worth $20,000 or less, or filing a personal injury lawsuit. Keep an eye on the clock to ensure you initiate legal proceedings within the two-year statute of limitations.
- Always consult a Texas car accident lawyer to explore your options and receive valuable legal advice and support.
Contacting a Texas Car Accident Attorney Who Handles Denied Insurance Claims
Having your car insurance claim denied can be overwhelming, especially if you were relying on a payout to help you recover and get back on the road. Our car accident lawyer in McAllen and San Antonio specializes in car accident claims and can advocate for your rights and fight to secure the compensation you deserve.
We have successfully represented clients injured in car accidents in San Antonio, McAllen, and the surrounding areas, including Rio Grande City, Mission, Edinburg, Converse, and Schertz. You can book a free, no-obligation case review with award-winning attorney Dr. Louis Patino to discover where you stand.
To get started, call 855-LAW-NINJA, submit a confidential contact form, or pop into one of our Texas offices. You can reach us 24/7, and you will only pay legal fees when we win your case.
