Car Accident Claim Denied? What To Do Next

Receiving a denial letter from an insurance company after a car accident can feel like a punch to the gut. You are already dealing with vehicle damage, potential injuries, and the disruption of your daily life. The last thing you need is a rejection letter telling you that the financial support you were counting on isn’t coming.

It is easy to feel helpless or assume that the insurance company’s decision is final. But here is the good news: a denial is not the end of the road. It is often just the beginning of a negotiation process. Insurance adjusters make mistakes, and claims are frequently denied for reasons that can be fixed or challenged.

This guide will walk you through exactly what to do if your claim is rejected. We will look at why claims get denied, the specific steps you can take to fight back, and when it is time to call in a professional to handle the legal heavy lifting.

Why Was My Car Accident Claim Denied?

Before you can fix the problem, you need to understand what went wrong. Insurance companies are businesses, and their goal is to minimize payouts. However, they must provide a specific reason for denying a claim. This reason will be outlined in your denial letter. Here are some of the most common hurdles drivers face.

1. Disputes Over Liability

The most frequent reason for a denial is a dispute over who caused the crash. If the insurance company believes their policyholder was not at fault—or if they believe you were mostly at fault—they will deny liability. In states with comparative negligence laws, they might argue that your actions contributed enough to the accident to bar you from recovery.

2. Policy Exclusions or Lapses

Sometimes the issue isn’t about the accident itself, but the paperwork.

• Lapsed Coverage: If the at-fault driver didn’t pay their premiums, their policy might have been canceled before the crash occurred.
• Excluded Drivers: Policies often list specific people who are covered. If an unlisted driver (like a teenager or a friend) was behind the wheel, the insurer might refuse to pay.
• Scope of Employment: If the driver was using a personal vehicle for business purposes (like delivering pizza or driving for a rideshare app) without the proper commercial insurance, a personal policy will likely deny the claim.

3. Lack of Evidence or Documentation

A claim cannot succeed without proof. If you didn’t file a police report, failed to take photos at the scene, or delayed seeking medical attention, the insurer might argue there is no proof the accident caused your injuries. A “gap in treatment”—waiting weeks to see a doctor—is a major red flag for adjusters, who will argue your injuries aren’t serious or happened elsewhere.

4. Exceeding Policy Limits

Every insurance policy has a maximum payout limit. If your damages (medical bills, car repairs, lost wages) exceed the at-fault driver’s coverage limits, the insurer will pay up to the limit and deny the rest. While this technically isn’t a full denial, it leaves you with unpaid bills.

Steps to Dispute a Denied Claim

Once you understand the “why,” you can formulate a plan. Do not let the denial letter sit in a drawer. You have a limited time to respond, so take action immediately.

Step 1: Review the Denial Letter Carefully

Read the letter multiple times. Identify the specific language and codes they used to justify the rejection. Compare their reasoning against your copy of the insurance policy (if it is your own insurer) or the facts of the accident (if it is the other driver’s insurer). Look for factual errors. Did they get the date wrong? Did they misinterpret the police report? Small errors can sometimes be the basis for a successful appeal.

Step 2: Gather Additional Evidence

If the denial was based on a lack of proof or a liability dispute, you need to strengthen your case.

• Police Report: Get an official copy. If the officer cited the other driver for a violation, highlight this.
• Witness Statements: Did anyone see the crash? A written statement from a neutral third party carries significant weight.
• Medical Records: Ensure your medical records clearly link your injuries to the accident date. Ask your doctor to be specific in their notes.
• Photos and Video: Pictures of skid marks, vehicle damage, and road conditions can disprove an adjuster’s theory about how the crash happened.

Step 3: Write a Formal Appeal Letter

Compose a detailed letter to the insurance adjuster responding to the denial. Keep your tone professional, calm, and factual. Avoid venting anger or making accusations.

• State clearly that you are disputing the denial.
• Address each point raised in their denial letter specifically.
• Reference the new evidence you are attaching (e.g., “Enclosed is the police report which states clearly that your insured ran a red light…”).
• Request a specific review of your claim.

Step 4: File a Complaint with the State

If you believe the insurance company is acting in bad faith—ignoring evidence, delaying unreasonably, or misrepresenting the law—you can file a complaint with your state’s Department of Insurance. While this government body cannot force a settlement, an official inquiry from the state often motivates insurance companies to take a second, more serious look at your claim.

When to Hire a Lawyer

Handling a minor dispute on your own is possible, but some situations require legal expertise. Insurance companies have teams of lawyers working to protect their profits. If things get complicated, you need someone on your side to level the playing field.

You Should Consider an Attorney If:

• The Denial is Based on Liability: If it is your word against theirs, proving fault can be legally complex. A lawyer can hire accident reconstruction experts to prove exactly what happened.
• Injuries are Severe: If you have significant medical bills or long-term injuries, the stakes are too high to risk a mistake. Lawyers know how to calculate future medical costs and pain and suffering, ensuring you don’t settle for less than you need.
• The Insurer is acting in Bad Faith: If the company refuses to communicate, delays payment without reason, or misleads you, a lawyer can file a “bad faith” lawsuit, which can sometimes result in damages beyond the original claim amount.
• The Appeal was Rejected: If you have already tried to appeal and were denied again, your next option is likely a lawsuit. You will need an attorney to navigate the court system and file a complaint before the statute of limitations expires.

Don’t Give Up

A denied claim is a hurdle, not a stop sign. Many denials are overturned when policyholders push back with organization, evidence, and persistence. By understanding the process and knowing when to ask for help, you can fight for the compensation you deserve.

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Meta Title: Car Accident Claim Denied? Here Is What To Do Next
Meta Description: Has your car accident claim been denied? Don’t panic. Learn the common reasons for denial, how to write an appeal letter, and when to hire a lawyer.