Why Is It Taking so Long to Process My Claim?
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You buy car insurance for protection. Unfortunately, car insurance companies sometimes take too long to process a claim.
It typically takes about 30 days for an insurer to process a car insurance claim. If your claim is taking longer, however, then it could be due to a number of different reasons.
Some insurance claims are more complicated than others. The claim might require statements from multiple witnesses, for example, or a detailed investigation by a team. Some claims require multiple adjusters, while others require just a single adjuster.
In other cases, insurance companies drag their feet for malicious purposes. The insurance company is acting in bad faith, for example. The company is deliberately delaying the payout of your claim or demanding excessive documentation, for example.
Put simply, there are many reasons why it’s taking a long time to process your claim. Today, we’re explaining some of the most common reasons.
Most Insurers Aim to Settle and Pay a Claim Within 30 Days
First, let’s establish some ground rules. Most car insurance companies want to settle and pay your claim within 30 days.
If you report your claim today, for example, then your insurer should be able to settle and pay that claim within 30 days.
In most cases, with most reputable insurance companies, the insurer will do its best to complete your claim as soon as possible. Insurers want to keep customers happy. They also want to avoid the scrutiny of state insurance regulators.
However, the “30-day rule” is not a hard requirement. Most insurers use it as a general guideline. Ideally, they’ll pay your claim within 30 days, but it’s not unusual for claims to take 60 or 90 days.
Many states have laws requiring insurers to settle a claim in a timely manner. Some states have specific time limits for insurance claims – like within 90 days. Other states have less specific timeframes.
How Long Do Insurers Have to Settle a Claim?
Every state in America has its own insurance rules. Some states have specific timeframes during which insurers must complete a claim. Other states use general guidelines, simply requiring insurers to process claims “within a reasonable timeframe”.
The time limit to file your claim depends on two factors:
- Your insurance company
- The state in which you’re filing the claim
Insurance companies are regulated at the state level. There are no federal requirements governing the length of time insurance companies have to process a claim.
Sometimes, insurance companies would rather take 10 weeks to file an insurance claim, for example, because they want to get the claim right the first time. The insurance company doesn’t want to rush through the claim, so they take the time to investigate thoroughly and get it right.
There Are Different Rules for Different Claims
Claims settlement regulations are divided into two main categories: property damage claims and bodily injury claims. An insurer might have 30 days to acknowledge a property damage claim, for example, but only 15 days to acknowledge a bodily injury claim.
In California, for example, all claims must be acknowledged within 15 days. After receiving proof of the claim, insurers are required to accept or deny a claim within 40 days. Once a settlement has been reached, the insurer must pay the policyholder within 30 days.
In New York, meanwhile, drivers have 30 days to file a claim with their own insurer and 30 days to file for disability payments.
How Long Do I Have to File a Claim?
Most insurance cards state that you have to call your insurer within 24 hours of an accident, for example. However, this is just a suggestion: it’s not a hard requirement.
Each state has a different statute of limitations for property damage and bodily injury. This statute of limitations can last years from the original date of the incident.
In Florida, for example, you have up to four years to file a claim for property damage and bodily injury. In Illinois, you have up to five years to file a claim for property damage and up to two years for bodily injury claims.
Generally, the sooner you file a claim – the better. Notify your insurance company as soon as it’s safe to do so after an accident. However, if it’s been weeks or even months since the incident, you might still be able to file a claim.
Factors that Increase Claims Processing Times
Your insurance company generally wants to file your claim as quickly as possible. However, certain factors can increase claims processing times:
State Laws: States have different laws for claims processing times. Some states have strict time limits. Other states have general guidelines. Some states have no oversight whatsoever.
The Insurance Company: Insurance companies process claims in different ways. Some insurers have lots of staff and resources available for any claim, while other insurers are chronically understaffed.
There’s Personal Injury: Personal injury damages add significant complications to an insurance claim. If there are one or more personal injuries involved in your claim, then it could significantly increase the claims processing time. Car damage is straightforward. Bodily injury damage is not.
The Type of Claim: Some car accidents are more serious than others. A freeway collision involving ten vehicles is more complicated than a fender bender at a red light.
Disputed Fault: Many car accidents come down to one driver’s word against the other driver’s word. In this situation, police and insurance adjusters may need to conduct a thorough investigation. The insurance company may also need to negotiate to determine which driver is more at-fault and which insurance company should cover more of the claim.
No-Fault States Versus At-Fault States: Most states in America are at-fault states, where fault must be determined after every accident before the claim is settled. This can delay medical bill payouts for months or even years while the investigation is being completed. 13 states are no-fault states, where the insurance company pays the policyholder regardless of fault, which means you receive payout much more quickly.
All of these factors can have a significant impact on the insurance claim payout process.
How to Speed Up the Insurance Claim Process
Sometimes, the insurance claim is out of your hands. There’s nothing you can do to speed it up. In other situations, there are things you can do to speed up the claim.
Respond Quickly: When both sides respond quickly, it speeds up the claim for everyone.
Call your Insurer: Be proactive about contacting your insurance company. Don’t sit back and wait for them to call you. Ask them what’s taking so long with your claim and if there’s anything you can do to speed it up.
Call the Other Insurer: Be proactive when requesting documentation from the other driver. Ask for the other driver’s VIN, license information, and insurance information. Contact the other driver’s insurance company if the other driver was at fault.
Keep Good Documentation: Take lots of photos. Keep evidence of medical bills and other records. The more documentation you have, the easier it is to support your insurance claim.
Double Check Information: Repair and replacement estimates vary. Double-check estimates from your insurer to make sure all damage is covered. Make sure the estimate was provided by a shop that does quality work.
What to Do If Your Insurance Company is Dragging Its Feet
Generally, your insurance company wants to settle your claim as quickly as you want to settle it. Your insurance company doesn’t want to drag it out: it wants to settle your claim within 30 days of hearing about it.
However, some insurance companies drag their feet, delay payout, or engage in other deliberate acts to delay your claim. They might demand excessive paperwork, for example, or offer an insultingly low settlement offer.
In this situation, you may want to hire a car accident attorney. A good car accident attorney can force an insurer to take your claim seriously, negotiating with the insurer for every penny you’re owed.
A car accident attorney will analyze your insurance policy, investigate the accident, and analyze your damages and injuries. Then, based on this investigation, the attorney will determine how much you should be paid.
Which Insurance Companies Have the Best and Worst Claims Processing Times?
Some insurance companies are known for processing claims quickly and efficiently. Other insurance companies are known for being thorough with claims, taking their time to do a complete investigation. And some insurance companies are just bad at handling insurance claims, taking a long time to process your claim, understand your claim, and settle it.
Some of the best and worst insurance companies for claims processing times include:
Fastest Companies for Claims Processing
All of the companies below scored 878 or higher on the latest J.D. Power car insurance report for claims satisfaction, indicating a fast and efficient claims process:
Slowest Companies for Claims Processing
The companies below scored 857 or lower for claims processing on the latest J.D. Power report. They’re still among the best-rated insurance companies in the country, although they have poorer claims satisfaction than the companies above:
- CSAA Insurance Group
- American Family Insurance
- Liberty Mutual
The slowest car insurance companies in America are not ranked in J.D. Power reports. Although the companies above are relatively slow compared to the best companies, there are plenty of slower insurance companies in America, including cheap car insurance companies and high-risk car insurance companies.
Why is it taking so long to process your car insurance claim? It could be several factors:
- State regulations
- Complicated claim investigation
- Personal injury damages
- Other factors
Sometimes, the insurance company is acting in bad faith, dragging its feet to delay your claim as long as possible. In most cases, however, insurers are simply doing their due diligence, completing a thorough investigation of your claim.