Insurer repudiating your claim? What does this mean.

Has your insurer repudiated your claim? Learn what a repudiation means, what steps you can take to challenge the decision and when you should seek legal advice.

What to Do If Your Insurer Repudiates Your Claim

Having an insurance claim repudiated can be frustrating, particularly when you believe that the loss is covered by your policy. A repudiation is not necessarily the end of the matter. If your insurer has rejected your claim, there are steps you can take to understand the decision and, where appropriate, challenge it.

1. Ask for the repudiation in writing

Your first step should be to obtain the insurer’s decision in writing. The insurer should provide the reasons for the repudiation in sufficient detail to enable you to understand and challenge the decision.

Under the Policyholder Protection Rules, an insurer that repudiates a claim must communicate the reasons for its decision and provide information regarding the policyholder’s rights to make representations and use the insurer’s internal escalation or review process.

2. Review your policy carefully

A claim should be assessed against the actual terms and conditions of the policy.

The reason given for the repudiation may relate to an exclusion, breach of a policy condition, non-disclosure, misrepresentation, alleged fraud, late notification or another issue affecting cover.

It is therefore important to consider the wording of the policy, the circumstances of the loss and the basis relied upon by the insurer before accepting the repudiation.

3. Do not simply accept the insurer’s decision

If you disagree with the repudiation, you may make representations to the insurer and request that the decision be reviewed.

Insurers are required to have appropriate internal claims escalation and review processes, and these processes should allow claimants to escalate claims that have not been resolved to their satisfaction.

A properly prepared representation should address the insurer’s reasons for repudiation and explain, with reference to the policy and relevant facts, why the decision should be reconsidered.

4. Consider the Ombud or legal action

If the dispute cannot be resolved through the insurer’s internal process, you may be able to approach the relevant insurance ombud.

In appropriate circumstances, legal proceedings may also be considered. The correct approach will depend on the policy, the nature of the dispute, the amount involved and the applicable time limits.

It is important not to delay. Insurance policies can contain contractual time limits relating to legal proceedings, and these should be carefully considered when deciding how to proceed.

When should you consult an attorney?

If your claim has been repudiated, particularly where a substantial amount is involved, it is advisable to obtain legal advice before accepting the insurer’s position.

An attorney can assess the policy, the insurer’s reasons for repudiation and the evidence surrounding the claim, and advise you on the appropriate course of action.

At Palm Hollander Incorporated, our insurance litigation team assists policyholders and insurers with complex insurance disputes, including repudiated claims, policy interpretation and coverage disputes.

If your insurance claim has been repudiated, we can assist you in understanding your rights and assessing the way forward.