The Claim Game: What to Do When Your Insurance Claim Isn’t Covered
The subject of claims is a very sensitive topic in the insurance world, and one of the most frustrating things is when a claim is denied. From my experience in this field, I find there are some misconceptions about coverage provided by insurance policies and the claims process.
The first misconception is that your policy covers everything. Unfortunately, that type of policy does not exist, and even if it did, no one could afford it! Typically, insurance policies fall into two categories. One is named Peril, which means the policy specifically lists what perils are insured against. If a loss occurs and it is not one of the perils insured against, the claim would be denied. The other type is called Special, meaning the policy covers everything except what is listed in the Exclusions Section of the policy. In this situation, if a loss occurs and the cause is listed under Exclusions, the claim would result in no payout.
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Another popular complaint I hear is, “Just what am I paying premiums for if nothing is covered?” In my position, I have had the opportunity to get a broad view of the industry, which includes how rates are developed. This has given me a great understanding of how premiums are established. The unfortunate thing is our members and clients do not have the same information readily available. This is why I believe having a personal agent provides great benefit – someone who can help insureds understand the promise, value and coverage provided for the premiums paid.
The last misconception I will discuss is that insurance companies love taking your money, but never want to pay claims. I cannot speak for every insurance company, but my personal experience with Farm Bureau is that if a loss occurs that was caused by a covered peril, the company will pay what is due the insured according to the terms of the policy. With that being said, I understand that some claim situations are more complex, but the goal is to pay what is covered by the policy and owed by the company.
Every insured should read their policy and consult with an agent to have a greater understanding of the coverage provided in return for the premiums paid. If you have any questions concerning your insurance policies, our Farm Bureau agents are just a quick phone call or a short drive away and stand ready to serve you!
– Allan Williams