How do you dispute a car insurance claim?
Car insurance claims are often difficult to deal with when they’re denied. It’s important to know what to do if you’re denied coverage or your claim has been rejected.
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Joel Ohman
Founder & CFP®
Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...
Founder & CFP®
UPDATED: Jul 9, 2023
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Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.
UPDATED: Jul 9, 2023
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident car insurance decisions. Comparison shopping should be easy. We are not affiliated with any one car insurance company and cannot guarantee quotes from any single company.
Our partnerships don’t influence our content. Our opinions are our own. To compare quotes from top car companies please enter your ZIP code above to use the free quote tool. The more quotes you compare, the more chances to save.
On This Page
- Determine why your insurer denied your claim so you can accurately appeal the decision
- To dispute a car insurance claim, you may need to provide relevant evidence to your insurer
- Insurance companies can deny claims if you do not carry the proper coverage, if an excluded driver was behind the wheel, or if you filed false information
It may feel like a whirlwind if you’ve recently been in a car accident. Taking care of everything after an accident can be stressful and overwhelming. But what if your claim for auto insurance coverage gets denied by your insurance company? Is there a way to dispute an insurance claim?
Fortunately, you can dispute and appeal decisions made by your car insurance company regarding any insurance claims you file. However, to get your insurer to change its mind, you may need to provide sufficient information and evidence that your policy should cover the accident.
Read on to learn some tips for disputing car insurance liability decisions and then enter your ZIP code in our free tool to start comparing car insurance to get affordable car insurance quotes so you hopefully won’t find yourself needing to appeal a car insurance claim.
Can I dispute an insurance claim?
Insurance companies allow policyholders to dispute claims. However, it’s the policyholder’s responsibility to learn why their insurer denied the claim before appealing the decision.
To understand why your insurance company denied your claim, you must read your claim denial or settlement offer letter. This letter will explain how the company came to a specific decision, and it should allow you to understand what you’ll need to prove or disprove to change the outcome.
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How can I dispute an auto insurance claim?
Once you know why your insurance company denied your claim, the first step is to collect the necessary information and evidence to prove the company should cover your claim.
If you were in an accident and the police filed a report, you can request a copy of the accident report. If you’re at fault, attempts to dispute your insurance claim could be more complicated, depending on the insurance type you carry.
You should review your insurance policy to determine how your coverage level may impact your company’s decision. You should also be able to find a bill of rights testament on your insurance company’s website, which will explain your rights when it comes to appealing a claim.
Take a look at this table to see the average rates for various coverage types across the country.
| States | Average Annual Full Coverage Rates |
|---|---|
| Idaho | $673.13 |
| Iowa | $683.67 |
| Maine | $689.12 |
| Wisconsin | $716.83 |
| Indiana | $728.93 |
| South Dakota | $744.28 |
| Vermont | $746.79 |
| Ohio | $766.66 |
| North Dakota | $768.09 |
| North Carolina | $768.28 |
| New Hampshire | $795.50 |
| Nebraska | $805.99 |
| Virginia | $836.14 |
| Alabama | $837.09 |
| Wyoming | $844.33 |
| Missouri | $845.39 |
| Kansas | $850.79 |
| Utah | $852.66 |
| Illinois | $854.10 |
| Tennessee | $855.56 |
| Minnesota | $856.62 |
| Hawaii | $858.16 |
| Montana | $868.55 |
| Oregon | $894.10 |
| Arkansas | $900.18 |
| Kentucky | $917.49 |
| New Mexico | $920.42 |
| South Carolina | $936.69 |
| Colorado | $939.52 |
| Pennsylvania | $950.42 |
| California | $951.75 |
| Washington | $952.10 |
| Mississippi | $957.59 |
| Arizona | $961.88 |
| Countrywide | $981.77 |
| Oklahoma | $985.58 |
| Georgia | $991.25 |
| West Virginia | $1,032.45 |
| Alaska | $1,050.09 |
| Texas | $1,066.20 |
| Nevada | $1,083.42 |
| Maryland | $1,096.37 |
| Massachusetts | $1,107.76 |
| Connecticut | $1,132.78 |
| Florida | $1,208.77 |
| Delaware | $1,215.69 |
| Rhode Island | $1,257.40 |
| District of Columbia | $1,324.39 |
| New York | $1,327.82 |
| Louisiana | $1,364.17 |
| New Jersey | $1,379.20 |
| Michigan | $2,611 |
| Average | $1,943.80 |
The rates in this table are averages to help you form a baseline expectation of what you could be paying in your state, but your personal situation, age, credit score, driving history, etc. will affect your exact rates.
What is an appeal letter for an insurance claim?
Once you’ve done your research and determined how you’ll dispute your insurance company’s decision, the next step is to write an appeal letter telling your company why its denial of your claim was incorrect.
Most insurance companies require policyholders to submit any appeals to claim decisions in writing. You have the option of doing this on your own, but you can also hire an insurance attorney to help you.
While hiring an attorney could be costly, it could be the right decision, especially if you’re disputing a claim denial of thousands or tens of thousands of dollars.
Your appeal letter is a simple statement explaining why your claim for coverage should be accepted. However, you may need to cite specific evidence to support your conclusion in the letter.
Once your letter is ready, you will submit it via certified mail or email to your company. Check with a representative of your insurance company to determine how you should submit your appeal letter.
Why do insurance companies deny claims?
Though you might be convinced your insurance company should accept your claim, there are many reasons insurance companies deny policyholders’ claims.
The most prevalent reason for claims denial involves auto insurance coverage. For example, suppose you were driving and caused a car accident. If you only carry liability coverage and file a claim to repair your vehicle, an insurer will deny your claim since liability only pays for damage to the other driver’s vehicle. You must carry collision coverage to cover damages to your vehicle.
Some insurance companies don’t cover other people when they drive your car. So before lending your vehicle to a friend, family member, or neighbor, read the fine print of your policy to discern whether your insurance company considers people not named on your policy to be excluded drivers.
Lastly, your insurance provider will deny your claim if you are dishonest. For example, some companies deny claims if a person was in an accident while driving for work-related reasons but told the insurance company they did not use their vehicle for business use.
More severe examples of dishonesty — such as filing a false claim — can get individuals into trouble. For instance, there may be an investigation if your insurance company believes you committed auto insurance fraud, depending on the claim and amount of money at stake.
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Should I file a lawsuit to dispute my insurance claim?
If you wrote an appeal letter sufficiently proving your claim should be accepted, and your insurer refuses coverage, you may want to consider filing a lawsuit.
Lawsuits are timely and costly, so ensure your claim acceptance is worth the effort before suing your insurance company. You will also need to familiarize yourself with your state’s statute of limitations.
A statute of limitations is a law dictating the maximum amount of time an individual has to file a lawsuit from the date of the incident. The statute of limitations for personal injury and property damage claims varies from one state to another.
The table below shows each state’s statute of limitations.
State Personal Injury Statute of Limitations Property Damage Statute of Limitations
Alabama 2 years 2 years
Alaska 2 years 6 years
Arizona 2 years 2 years
Arkansas 3 years 3 years
California 2 years 3 years
Colorado 3 years 3 years
Connecticut 2 years 3 years
Delaware 2 years 2 years
Florida 4 years 4 years
Georgia
2 years 4 years
Hawaii 2 years 2 years
Idaho 2 years 3 years
Illinois 5 years 2 years
Indiana 2 years 2 years
Iowa 2 years 5 years
Kansas 1 year 2 years
Kentucky 1 year 2 years
Louisiana 1 year 1 year
Maine 6 years 6 years
Maryland 3 years 3 years
Massachusetts 3 years 3 years
Michigan 3 years 3 years
Minnesota 2 years 6 years
Mississippi 3 years 3 years
Missouri 5 years 5 years
Montana 3 years 2 years
Nebraska 4 years 4 years
Nevada 2 years 3 years
New Hampshire 3 years 3 years
New Jersey 2 years 6 years
New Mexico 3 years 4 years
New York 3 years 3 years
North Carolina 3 years 3 years
North Dakota 6 years 6 years
Ohio 2 years 2 years
Oklahoma 2 years 2 years
Oregon 2 years 6 years
Pennsylvania 2 years 2 years
Rhode Island 3 years 10 years
South Carolina 3 years 3 yearas
South Dakota 3 years 6 years
Tennessee 1 year 3 years
Texas 2 years 2 years
Utah 4 years 3 years
Vermont 3 years 3 years
Virginia 2 years 5 years
Washington 3 years 3 years
Washington D.C. 3 years 3 years
West Virginia 2 years 2 years
Wisconsin 3 years 3 years
Wyoming 4 years 4 years
Research your state’s statute of limitations to ensure you still have time to initiate legal action.
Before suing your insurance provider, consult an insurance attorney who can help you decide how likely your insurance company will cover your claim and whether a lawsuit is worth it.
Case Studies: Disputing Car Insurance Claims
Case Study 1: Denied Coverage for Faulty Repairs
John’s car was involved in an accident, and he filed a claim with his insurance company to cover the repair costs. However, the insurance company denied his claim, stating that the damages were a result of faulty repairs from a previous incident. John contested the claim denial, gathering evidence including a reputable mechanic’s second opinion to prove the accident caused the damages.
Case Study 2: Disagreement Over Fault and Coverage
Sarah’s car was hit by another driver who ran a red light. Sarah’s insurance company initially denied her claim, arguing that she was partially at fault for the accident. However, Sarah believed she had the right of way and was not at fault. She decided to dispute the claim denial and obtained surveillance footage from nearby cameras that clearly showed the other driver’s violation.
Case Study 3: Insufficient Payout for Total Loss
Mark’s car was severely damaged in a flood, resulting in a total loss. However, when Mark filed a claim, his insurance company offered a payout that was significantly lower than the market value of his vehicle. To challenge the offer, Mark researched comparable sales to determine the actual value and submitted evidence of his car’s condition and features in his appeal letter.
How to Dispute a Car Insurance Claim: The Bottom Line
In some cases, disputing a claim decision made by your insurance company can be a straightforward process. You need to know why your insurer denied your claim, gather evidence to support your perspective, and submit an appeal letter to your insurance company.
If your company decides to cover your claim, you should not have to do anything else. However, if your insurance company continues to deny your claim, you may want to consider suing your insurance provider.
Before considering any legal action, you should speak with an insurance attorney.
To see how you can save on car insurance so you have the coverage you need so you hopefully won’t ever find yourself disputing a car insurance claim, type your ZIP code into our free tool now.
Frequently Asked Questions
What is a car insurance claim dispute?
A car insurance claim dispute occurs when the policyholder disagrees with the insurance company’s decision regarding their claim. It could involve issues such as claim denial, insufficient payout, delays, or disagreements about fault or coverage.
When should I consider disputing a car insurance claim?
You should consider disputing a car insurance claim if you believe the insurance company’s decision is unfair, inaccurate, or unjustified based on the terms of your policy or the circumstances surrounding the claim.
What steps should I follow to dispute a car insurance claim?
To dispute a car insurance claim, follow these steps:
- Review your policy: Familiarize yourself with your insurance policy to understand your coverage, limitations, and any applicable conditions.
- Gather evidence: Collect all relevant documents, such as photos, videos, witness statements, police reports, and medical records, to support your case.
- Contact your insurance company: Notify your insurance company about your intention to dispute the claim. Ask for the specific reasons behind their decision and clarify any doubts or discrepancies.
- Document everything: Maintain a detailed record of all conversations, including dates, times, names of representatives spoken to, and summaries of discussions. Keep copies of all written communication, including emails and letters.
- Seek professional advice: If you’re uncertain about the dispute process or need assistance, consider consulting an attorney specializing in insurance claims or contacting your state’s insurance department for guidance.
- Submit a formal appeal: Prepare a written appeal letter addressing the specific reasons for your dispute and include supporting evidence. Follow the instructions provided by your insurance company on how to submit the appeal.
- Follow up: Stay in regular contact with your insurance company to track the progress of your appeal. Be prepared to provide any additional information or documentation they may request.
How long does the dispute process usually take?
The duration of the dispute process can vary depending on factors such as the complexity of the claim, the availability of evidence, and the specific procedures followed by the insurance company. Some disputes can be resolved within a few weeks, while others may take several months.
What options do I have if the insurance company denies my appeal?
If your appeal is denied, you have a few options:
- Mediation: Consider participating in a mediation process where a neutral third party helps facilitate a resolution between you and the insurance company.
- Arbitration: If your policy includes an arbitration clause, you can proceed with arbitration, which involves presenting your case to an arbitrator who will make a final decision that both parties must abide by.
- Legal action: As a last resort, you may choose to file a lawsuit against the insurance company. Consult with an attorney to determine the feasibility of pursuing legal action.
Free Car Insurance Comparison
Enter your ZIP code below to view companies that have cheap car insurance rates.
Secured with SHA-256 Encryption
Joel Ohman
Founder & CFP®
Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...
Founder & CFP®
Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.