Submitting an insurance claim due to a car accident, personal injury, or property damage can be overwhelming, especially when facing a denial. Unfortunately, insurance companies in South Dakota do not always approve valid claims. In fact, it is not unusual for insurers to deny payment, often leaving policyholders feeling overwhelmed and uncertain about what to do next.
In the guide below, we will review why insurance companies deny claims and your legal options when this happens.
Policy Exclusions and Limitations
Insurance policies are filled with fine print, and many denials stem from exclusions written into the coverage. For example, if you file a homeowners insurance claim for flood damage, but your policy specifically excludes flood events, the insurer will likely deny your claim. Similarly, auto insurance may not cover all drivers or types of damage unless explicitly stated. That is why it’s crucial to thoroughly read your policy or have a lawyer examine it to understand the coverage details.
Alleged Misrepresentation or False Information
If an insurance company believes you made a false statement during your application or claim process, they may use that as a reason to deny payment. This could include:
- Failing to disclose prior damage or preexisting conditions
- Exaggerating the value of a loss
- Providing inconsistent statements to adjusters
Even an honest mistake can trigger a denial, so it’s crucial to be accurate and consistent when dealing with insurance companies.
Lapsed or Inactive Policy
In some cases, a claim is denied because the policyholder missed a payment or allowed their coverage to lapse. South Dakota insurers are required to notify policyholders before canceling coverage for nonpayment, but if you’re unaware your policy has lapsed, you could be left without protection when you need it most.
For these reasons, always keep track of premium payments and renewal notices—and save documentation of any correspondence with your insurer.
Failure to File Promptly or Follow Procedures
Each insurance policy outlines specific procedures for reporting a claim, including deadlines. Delaying your claim submission, not supplying requested documents, or cooperating with the investigation may lead to a denial due to “noncompliance.”
In South Dakota, timely notice is often essential, especially with personal injury or auto accident claims. It’s best to report any loss or incident as soon as possible and keep records of your communication with the insurance company.
Disputes Over Fault or Coverage
In auto accidents or liability claims, insurance companies frequently reject claims by asserting that their policyholder is not responsible or that the injured party shares too much blame.
According to South Dakota’s comparative negligence rule, if you are deemed more at fault than the other party, you may be prevented from receiving compensation for damages. Insurers may also dispute the extent of your injuries or claim that the damage existed before the event. This is why thorough documentation and legal support are critical.
What to Do If Your Insurance Claim Was Denied
Receiving a denial from the insurance company does not necessarily mean it is the end of the road for you and your claim. Instead, in these instances, you have the right to:
- Request a written explanation of the denial
- Appeal the decision with supporting evidence
- Speak with an experienced insurance claim attorney
At Abourezk Law Firm, we know how insurance companies operate, and we are here to level the playing field. If you had a claim denied in South Dakota, do not take it at face value. Our team can review your policy, investigate the denial, and help you fight for the compensation you’re owed.
Schedule a Free Consultation Today
Denied claims can leave you feeling powerless. However, you do not have to take on the insurance company alone. Contact Abourezk Law today to schedule a free consultation and let us help you get the answers and support you need.