What Is a Denial Letter?

What Is a Denial Letter?

Imagine a situation in which your home catches on fire and causes substantial damage. Following the fire, you prudently submit your claim to your homeowner’s insurance carrier. After the claim is submitted, eventually an insurance adjuster comes out to your home and assesses the damage. During the investigation process, you are cooperating with the insurance carrier. After the investigation is complete, you speak with your insurance carrier to see how it will help you out in this dire situation. To your dismay, the insurance carrier tells you your claim is denied and list a number of reasons why the claim was ultimately denied. A couple days later you receive a letter outlining the reasons why the claim was denied. The aforementioned letter is what is called a denial letter.

A denial letter is a letter from the insurance carrier which is supposed to clearly articulate why your specific claim is being denied. Indeed, the denial letter should be able to explain how the facts of your particular loss interplay with the policy language and how and why the insurance carrier came to its ultimate conclusion on your claim. In the event that an insurance carrier denies your claim over a telephone call, you should request that the denial be sent to you in writing. Having your denial in writing is beneficial for a number of reasons, such as it helps memorialize the exact date of the denial, it outlines the specific reasons why the insurance carrier denied the claim and the applicable insurance policy language the insurance carrier is relying on to deny your claim.

As you can imagine, a denial letter is essential in your potential claim and the denial letter will help assist an attorney in evaluating your potential claim. In fact, it is important that you keep all correspondences from your insurance company during the pendency of a claim. Maintaining all correspondences between you and your insurance carrier helps provide a clearer picture of the events of your claim.

In sum, a denial letter is a crucial part of a potential insurance claim. It is paramount that you keep the denial letter, if you receive one, and have it readily available if you end up contacting an attorney to evaluate your potential claim. If an insurance carrier ends up denying your claim, keep in mind you are potentially not without options to obtain the benefits you are entitled to as a result of your loss.