As a business owner, you rely on your commercial insurance policies to provide a much-needed safety net to protect you, and your business against unexpected loss or damage. Yet there are times when it turns out that the cover you expected is not provided once a claim is submitted by you. Policyholders can be blindsided with coverage issues when the amount of the cover is less than expected or a claim ends up being rejected altogether.
Sadly, such large insurance disputes (involving sums of $100,000 or more) are more common than many think and often revolve around several main issues:
The extent of cover. Your policy, and schedule to it determines whether insurance cover will be extended to you (unless an exception applies).
Policy exclusions. An insurance claim may be rejected because of clauses in the policy that exclude certain events or situations, leaving policyholders and insurers at odds over what should or shouldn’t be excluded in their claim.
Policy terms and determination of damages. Disagreements may arise over coverage amounts or the calculated cost of the losses incurred.
Failure to Disclose. Sometimes a claim may be denied when the insurer believes that the policyholder engaged in an activity that increases their risk without disclosing this activity to the insurer. In that regard the Insurance Contracts Legislation may define the rights of the parties.
Policy Termination. If premiums are not paid on time, lapses in coverage may occur that will affect an policyholder’s ability to make a claim. Basically if the payment is not made in time and when required, coverage may not exist.
Whatever the reason, if you do not agree with your insurer’s assessment of a claim that involves a substantial dispute you may have specific rights. Naturally, it is better to know what your rights are and how you can go about exercising them. Some of the options may include internal and external dispute resolution, or perhaps approaching the Court.
In the end, insurance policies can be extremely lengthy and complicated. That’s why, if you find yourself in a situation where you are disputing an insurance claim, it is wise to consult an insurance litigation lawyer who is familiar with that type of problem or who can point you in a direction that might help you resolve the issue. At Litigant, our Principal Solicitor has been helping clients resolve insurance disputes for more than 10 years. We’re here to help you through all steps of the process, including drafting your insurance claim letters, managing internal and external reviews and even suing insurers for wrongfully denying a claim. To book a consultation, simply call us at+61 2 8644 0663.
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