Around 90 percent of Americans have health insurance, while many of these same citizens also have policies to cover their cars, homes, and other belongings against a range of eventualities.
Insurance is the one thing we all buy hoping that we never need to use it. But when you do need to make a claim, whether it’s for a missed vacation, a stolen car, or an expensive operation, the last thing you need is an insurance denial.
So, what are some of the reasons behind denied claims? Let’s take a look!
Paperwork Errors
Even the smallest errors in your paperwork can lead to an insurance claim denial. For example, your insurer might have your name as John Q. Smith and your healthcare provider’s office has listed you as John O. Smith. Or maybe they submitted your claim with the wrong billing code.
No matter the type of insurance, always make sure to go through your policy with a fine-tooth comb. Although you can’t stop other people from making errors, you can check that you’ve spelled and listed everything right.
Omission of Pertinent Details
Failing to disclose certain information is a common reason why a driver might receive a claim denial from their insurance provider. For example, if you neglected to tell your provider about your new speeding points or how you use your car as an Uber but don’t have rideshare insurance.
Whenever you switch to a new provider or policy, it’s good practice to reveal every minute detail of your driving and parking habits. And you should always update your insurer if your situation changes.
Cost Control
It’s common for insurers to want to save money. When it comes to health insurance, a claim denial can often mean that they want you to try a less expensive treatment option first. In many cases, the provider will then approve your claim for the requested service if you try the more affordable option first and it doesn’t work.
Your Plan Doesn’t Cover the Claim
This is a common reason for everything from rejected home cover claims to disability insurance denial. For example, many people have their request for LTD denied because they have a partial rather than total disability. Likewise, you may be covered for breakages on your home insurance inside the home, but not in your yard.
Policy wording is very very specific so you’ll need to check exactly what you’re covered for and what you’re not before claiming.
Failing to Follow Your Provider’s Rules
This is a very common reason for an insurance claim denial. Most providers have a strict set of rules you must follow whenever you need to make a claim. For example, your health insurance provider might insist on you getting pre-authorization for a particular non-emergency test. Even if you needed the test, without the pre-authorization, your insurer has every right to reject your claim.
The Top Reasons for Insurance Denial
As this quick guide shows, there are a lot of possible reasons for insurance denial.
The good news is, you can avoid most of these types of denied claims by making a point of checking your insurance paperwork, your level of coverage, and your provider’s rules on a regular basis. This way, when you do need to make a claim, you and your documents will be better prepared for the process.
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