What to do if insurance company is stalling?

Dealing with an insurance claim can already be stressful, but it becomes even more frustrating when an insurance company appears to be stalling.

Whether it’s a personal or business insurance claim, knowing what to do if the insurance company is stalling is crucial, this guide provides practical steps to address delays and protect your rights as a policyholder.

Recognizing signs of stalling by an insurance company

Before taking action, it’s important to identify whether the insurance company is genuinely stalling. Common signs include repeated requests for unnecessary documents, lack of communication, vague responses, or delayed claim decisions without valid explanations.

If these issues arise, it’s essential to act promptly.

Review your insurance policy

The first step is to thoroughly review the terms of the insurance policy. The policy outlines the responsibilities of both the policyholder and the insurance company, including timelines for claim processing.

Look for specific clauses related to deadlines for investigations and payouts. Understanding your policy will help you determine whether the company is breaching its obligations.

Document all interactions

Maintaining detailed records is crucial when dealing with a stalling insurance company. Document every interaction, including phone calls, emails, and letters. Take note of dates, times, names of representatives, and the content of conversations.

These records serve as evidence if you need to escalate the matter or involve legal assistance.

Communicate clearly and persistently

When reaching out to the insurance company, communicate clearly and assertively. Avoid emotional language and stick to the facts of the case. Clearly state your concerns about the delays and request specific timelines for resolving the claim.

Persistence is key, so follow up regularly until you receive a satisfactory response.

Request a written explanation for delays

If the stalling continues, request a written explanation for the delays. Under many state and federal regulations, insurance companies are required to provide clear reasons for claim processing delays.

A written response creates a record that can be used if you need to escalate the situation.

File a complaint with the insurance company

Most insurance companies have an internal complaints process to address disputes. File a formal complaint with the company, outlining the delays and your dissatisfaction. Include copies of all documentation, such as correspondence and claim-related documents.

Ensure the complaint is sent to the appropriate department and request a formal acknowledgment.

Involve your state insurance department

If the insurance company fails to address the delays, consider filing a complaint with your state’s Department of Insurance. State regulators oversee insurance practices and can investigate claims of unfair treatment or unreasonable delays. Provide all supporting documentation and a detailed explanation of the issue when filing the complaint.

Consider mediation or arbitration

Many insurance policies include clauses for mediation or arbitration to resolve disputes. These processes involve a neutral third party to help settle the disagreement.

Mediation is less formal and often quicker, while arbitration may result in a legally binding decision. Check your policy for details on these options.

Consult an attorney

If the delays persist despite your efforts, consulting an attorney experienced in insurance claims can be a powerful next step. A lawyer can assess your case, negotiate with the insurance company on your behalf, and take legal action if necessary.

In some cases, the threat of legal action alone is enough to prompt the company to process the claim more quickly.

Understand bad faith practices

Insurance companies are legally obligated to handle claims fairly and in good faith. If stalling tactics are deliberate and unreasonable, the company may be acting in bad faith.

Examples of bad faith practices include failing to investigate a claim, undervaluing damages, or denying a claim without justification. If bad faith is suspected, legal action can be taken to hold the company accountable.

Take preventative measures for the future

To avoid similar issues in the future, consider these proactive steps:

• Research companies before purchasing insurance: Choose a reputable insurer with positive customer reviews and a history of timely claims processing.
• Understand your policy: Familiarize yourself with the terms and conditions of your policy, including claim filing deadlines and required documentation.
• Maintain records: Keep all policy documents and related correspondence organized for easy reference.

To summarize

For those asking what to do if the insurance company is stalling, taking proactive steps is essential to resolve the issue and protect your rights. Start by reviewing your policy, documenting all interactions, and communicating persistently.

If delays persist, escalate the matter by filing complaints with the insurance company or state regulators and seeking legal advice if necessary. By staying informed and assertive, policyholders can navigate stalling tactics and secure the resolution they deserve.