The truth is that accidents are inevitable. No matter how careful you are, there’s always a chance that something could happen. Whether it’s a car accident, a slip, and fall, or anything in between, at some point, you’re going to need insurance. And when that time comes, the last thing you want is for your insurance company to deny your claim.
Insurance companies are in the business of making money, not paying out claims. So, it’s no surprise they often use underhanded tactics to avoid paying what you’re owed. One of these tactics is called post-claim underwriting.
This blog post discusses everything you need to know about post-claim underwriting and how your insurance company may be planning not to pay. Read on to learn more.
What Is Underwriting?
To understand post-claim underwriting, you must first understand the concept of underwriting. Underwriting is the process insurance companies use to determine whether or not to insure a person or property. They consider factors like credit history, claims history, and other risk factors to make their decision.
For example, let’s say you’re looking for car insurance. The insurance company will look at your driving history, any accidents you’ve been in, and other factors in determining how likely you are to get into an accident. Based on that information, they’ll decide whether or not to insure you and how much to charge you for premiums.
Keep in mind that insurance companies operate in the realm of probability. They’re not looking at whether or not you will get into an accident, but rather how likely it is that you will get into an accident.
So even if you’re a perfect driver with a clean record, they may still charge you higher premiums because of factors like the make and model of your car or where you live.
What Is Post-Claim Underwriting?
An insurance company engaged in post-claim underwriting usually doesn’t attempt to establish the risk posed by an insured individual or property before issuing a policy. Instead, they wait until after a claim has been filed to decide whether or not to insure the person or property.
There are a few reasons why insurance companies do this. For one, it allows them to collect premiums without paying out any claims. It also allows them to cherry-pick the customers they want to insure. They can deny coverage to people they deem too risky, saving them money in the long run.
Post-claim underwriting is legal in most states, but it’s still considered to be an unfair practice by many. That’s because it gives insurance companies an incentive to deny claims, even when they’re legitimate.
How Does Post-Claim Underwriting Occur?
The process of post-claim underwriting usually starts and ends with the policy application you filled out. Some insurance applications can be a trap if you’re not careful. They may leave out important information or deliberately mislead you so the insurance company can deny your claim later.
For example, let’s say you’re applying for health insurance. The application asks if you’ve ever been diagnosed with a certain condition. You answer no because you’ve never been diagnosed, but what it doesn’t mention is that the insurance company will later consider any symptoms you’ve ever experienced as a pre-existing condition.
So, if you later file a claim for treatment of that condition, the insurance company can deny your claim on the grounds that it’s a pre-existing condition.
It’s essential to be as honest as possible when filling out insurance applications. If you’re unsure about something, ask a representative from the insurance company for clarification. And if you’re ever in doubt, it’s always better to err on the side of caution and disclose any information that could potentially be used against you later on.
What Are the Consequences of Post-Claim Underwriting?
If you’re the victim of post-claim underwriting, the insurance company will most likely deny your claim. They may also cancel your policy and refuse to insure you in the future. This can leave you in a difficult financial situation if you rely on that insurance coverage.
It’s essential to fight back if you think you’ve been a victim of post-claim underwriting. You may be able to appeal the decision or file a complaint with your state’s insurance commissioner.
How Can You Protect Yourself from Post-Claim Underwriting?
If you’re concerned about your insurance company engaging in post-claim underwriting, you can do a few things to protect yourself.
When shopping for insurance, ensure you understand the application process and what information you’ll need to provide. And if you’re ever in doubt about something, don’t hesitate to ask questions.
It’s also a good idea to keep your own records of any conversations you have with your insurance company. That way, you’ll have a paper trail if there’s ever a disagreement about what was said or agreed upon.
Finally, remember that you have the right to shop around for insurance. If you’re unhappy with how your current insurer is treating you, don’t be afraid to switch to a different company. There are plenty of options out there, and you deserve to be treated fairly.
Summary
Post-claim underwriting is an unfair practice that incentivizes insurance companies to deny claims, even when they’re legitimate. If you think you’ve been a victim of post-claim underwriting, fight back by appealing the decision or filing a complaint with your state’s insurance commissioner.
You can also protect yourself by being aware of the application process and keeping records of your conversations with your insurance company.
And if you’re unhappy with how your current insurer is treating you, don’t be afraid to switch to a different company. There are plenty of options out there, and you deserve to be treated fairly
