Hassle-Free Health Coverage: Delaying Payment
Insurance companies used to settle claims more quickly than they do today. The theory was that if they settled quickly, they could do so for a smaller amount -- they'd just make sure the policyholder signed a release denying any further claims related to the accident in question. But, policies have become more complicated and many insurance companies have changed their tactics.
Now, many insurance companies delay payments as long as they can without inviting lawsuits.
You don't have to accept the delays, though. There are several basic principles that you should use in collecting from insurance companies:
- Analyze every part of loss for how it might be covered by your policy.
- Consider all of the claims you might make following an accident or loss. If you have health insurance or are covered under workers' comp can you make claims under these coverages?
- Don't accept a first offer -- or even a first denial -- by an insurance company as the final, unequivocal word.
Insurance companies will delay or deny claims if they can. If they do, ask for an explanation; in response, gather facts and reread your policies yourself. If you can't decipher everything in the policy, talk to your agent or -- if necessary -- a lawyer.
You might check the policy's exclusions too. Exclusions identify types of losses that are not covered by the policy. They help to shape the coverage or narrow the scope of coverage by specifying the losses that the policy won't pay for.
Exclusions usually form the basis of most of the legal disputes that occur between policyholders and insurance companies. They are generally included to accomplish these four broad purposes:
- to clarify intent of coverage;
- to remove coverages for losses which should be covered by other insurance;
- to remove coverage for losses which result from above-average risk factors which are not anticipated in rates and premiums (usually this coverage is available at an additional charge); and
- to remove coverage for catastrophic losses which are generally not insurable (although coverage may be available through special insurance pools or government programs).
Even if denial isn't your insurance company's ultimate goal, by playing the denial game, it can achieve something almost as advantageous -- a lengthy delay in paying the claim. The longer an insurance company can hold on to its money, the better off it is.
But the law, and more importantly the courts, don't give insurance companies free rein to delay fair settlements as they please.
