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Why Claims May Be Denied

                                                                                                     Why Claims May Be Denied


   Public trust in insurance companies is very low with only 15% of Canadians believing insurers are honest and fair according to a 2017 survey. There’s a common misconception that insurers collect premiums but don’t pay out claims when they happen. In reality, a small  percentage of actual claims are not paid. Claims may be denied due to lack of coverage, misunderstanding of policy coverages, or not providing the proper documentation needed to process a claim. Fraudulent versus genuine claims also comes into play.

What can you do? Make sure you understand what risks are and are not covered by your policy. No policy covers everything. There are always limitations and exclusions. Have a clear understanding of what your policy includes when you take it out so that there are no surprises. Call your broker at any time to check coverage or to ask any questions. An important part of our role is to advise and provide information.

Disclosure is also key. A small portion of claims are denied because of a pre-existing condition or other information a client didn’t disclose when taking out the policy. Even though such a nondisclosure may be a genuine oversight, the insurer can’t accept a claim for a risk that they didn’t know about. More advice next month.