Perseverance Pays When Filing Insurance Claims
By Kathryn Hauer, EA, CFP
Learn more about Kathryn on NerdWallet’s Ask an Advisor
When I consider insurance, I think about it as a bet I don’t want to win. If I use my disability insurance, it means I’m hurt. If I file an auto insurance claim, it means I had a car accident. When I pull out my insurance card at the doctor’s office, I’m sick. And when my husband or kids start looking for my life insurance policy, it will mean I’m no longer here.
None of these outcomes is desirable, but I carry insurance in case they happen. It’s comforting to know that an insurance company, rather than my family, will be responsible for the related financial risks.
Getting your money
What’s unnerving, however, is how hard it can be to get the money an insurance company owes you when you do make a claim. I’ve encountered situations in which the insurance company delays or denies payments to the insured. This can be true for many different types of insurance, whether it’s health, auto, long-term care, disability, life or some other kind.
Although most insurance agents and companies provide fair, speedy and excellent service, some may drag their feet on paying claims. Some may even be unscrupulous in their dealings with you. In one case, an insurance agent tried to sell my client mortgage insurance even though a mortgage insurance payout was being made to pay off the mortgage entirely. In other instances, I’ve seen medical claims erroneously denied until an extensive appeal finally corrected the health insurer’s ruling.
To minimize the chances of your insurance company delaying or denying your claim, know the rules specified in your insurance contract and be ready to provide documentation — sometimes repeatedly — to support your claim. Such information may include account numbers, proof of identity, original death certificates (not copies) and powers of attorney.
Also be aware that many insurance companies provide contracts online and don’t mail hard copies to their customers. But passwords can be forgotten — or lost, if their owner dies — and companies can go out of business, change hands or close online access. Make sure you secure your contract before you need it. Save a copy on your computer and print out and file hard copies in a safe place such as a designated file cabinet or safe deposit box. Make sure your family knows how to access your storage place.
What you need
If you need to make a claim, the first step is to contact your insurer. In most cases you will need to provide:
- The policy or contract that shows what kind of payment has been purchased and that you are the claimant, policyholder or beneficiary.
- Proof of identity, which includes things such as your Social Security card, marriage certificate, driver’s license, passport, birth certificate and pay stubs.
The insurance company will issue affidavit requests, beneficiary claim forms, identity verifications, address certifications and other forms you might need. Carefully and accurately complete these documents — and get them notarized, if required — to avoid delays in receiving your money.
Once you submit the necessary forms, be prepared to follow up until your money is in your hands. You may need to write numerous emails and letters. You may need to make many calls in which you’ll be required to select among a dizzying number of departments, often only to be disconnected accidentally or directed to leave a voicemail.
Write down the names, phone numbers and email addresses of everyone you talk with and keep notes about the conversation. It can take months to complete a claim, and you can forget whom you talked with and what they said. Going back to your notes can prevent repetition and speed resolution of the matter.
An insurance payment isn’t a gift
As you try to get paid for the injury, illness, accident or other misfortune that caused you to file an insurance claim, don’t let delays and runarounds deter you. Remember, you are getting a product you paid for, not a gift. Insurance is something you buy or pay for with taxes — like workers’ compensation and Social Security benefits — to protect yourself or your assets. In some form or another, you’ve already paid for the money you’re requesting.
This is important to keep in mind as you start what can be a time-consuming and arduous process. Guilt can sometimes get in the way of your fortitude, but in truth you are asking for only what you bought, not for a freebie. Review your policy, looking at old statements to refresh your memory about how much you paid over the years for this reimbursement. Totaling 20 years of premiums or tax payments will help reduce any guilt you might feel in asking for payments due you. And knowing you paid for your coverage fair and square will help you persist.
As a glass-half-full, butter-side-up optimist, I’m confident that patience and perseverance will eventually result in you getting the money you’re owed.