How do insurers look at claims?
The whole point of insurance is that you can claim when disaster strikes.
When considering claims, insurers will be taking into account a number of elements that will include policy conditions, sums insured and information provided by you. This is why it is important to check your policy documentation and, if you have any concerns about the accuracy of information you provided it is essential to address this with your insurer before any loss takes place.
Insurers value their customers and recognise an insurance product is measured by the way in which claims are settled. It is in everyone’s interests to ensure the claim process is as painless as possible and that the customers’ expectations are fulfilled. There are four core elements in a claims process: 1) Report the loss 2) Return the completed claims form, 3) Communicate and 4) Settlement
Report the loss
Report your loss as soon as possible as this gives your insurer an opportunity to take appropriate action to prevent further damage. Significant delays will leave insurers wondering why you have kept them in the dark and can affect any settlement.
Return the completed claims form
Although your insurer takes details when you report a loss, they will also provide you with a form that enables the details to be formalised and checked for completeness and accuracy. Once the form is returned, insurers will be in a better position to deal with your claim but that does not mean nothing happens until the form is returned.
If you work closely with insurers to deal with any residual queries, they will be able to make a settlement offer sooner. Insurers should provide you with updates on your claim but if you feel that something is unclear discuss your concerns with them.
When your insurers have completed their review they will authorise payment for repairs or replacement or offer you a settlement with an explanation as to how the amount offered has been reached.
To understand why this process operates it is useful to look at what Insurers are doing with the information you provide about your claim and what you can do if you are unhappy with a settlement offer.
To begin with, your insurer will check to ensure your claim is valid. For example, and in no particular order, they will want to be happy that:
- the loss date was during the policy period
- the information you provided when buying the policy is correct
- any lost or damaged property is covered by the policy
- the nature of the loss is covered by the policy
- you are the customer who bought the insurance
If any of these checks reveals a problem, you will be asked for more details so that your insurer clearly understands why you consider the claim is valid. This is why it is important to communicate with insurers.
If your claim is very small, your insurer may be satisfied to authorise settlement over the telephone. However, for larger claims, it is likely that your insurers will appoint a Loss Adjuster who will visit you to take fuller details and report upon their findings. It is important to be as open as possible with the Loss Adjuster who should be very experienced in this sort of work.
Relying on the loss adjuster’s report, your insurer will offer you a settlement or reject your claim. In making an offer, your insurer will take account of the basis of settlement provided by your policy, the policy sums insured, your policy excess and any other applicable policy conditions. Remember, the maximum payable under your policy is determined by the sums insured.
In the event that Insurers reject your claim, they will tell you why. This gives you the opportunity to correct any misunderstandings or inaccuracies.
If you are unhappy with the offer or feel your claim has been unfairly rejected, you are entitled to appeal or suggest a counter-offer. If this does not resolve the issue or you believe you have not been treated fairly, the complaints process is available for you to take matters further with your broker, your insurer and, finally, with the Financial Ombudsman Service.
A good insurer wants their customers to be happy with the claims service as this leads to recommendations and more business. As the customer, you are entitled to expect excellent service and fair treatment but this does not mean your insurer will simply pay out without asking the appropriate questions.
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