One fact that most people do not know about insurance is it isn’t as straightforward as all other types of product and most people ask can car insurance company deny coverage? The answer is YES, car insurance companies can go on to deny coverage under several situations and this is the reason why we have decided to bring you this article today to address this issue and also show you scenarios where insurance companies can get to deny coverage as well.
In almost every part of the United States Of America, every driver is expected to at least have some level of financial responsibility which would help in covering up for some costs if he ever gets involved in a car accident. What this means in simple terms is every driver should have auto insurance coverage and if we are being realistic here, most drivers take auto insurance applications for fun and do not treat it as a serious topic.
They go on to assume normal approval without having an idea as to the fact that claims can be denied and why. If you are interested in knowing more about the current status of driving then we encourage you to come with us right away as we would be taking you through the key reasons why car insurance companies tend to deny coverage of its insureds.
Can Car Insurance Company Deny Coverage
Non Renewal On Insurance Coverage
It is not up to an insurance company to go ahead and renew the insurance policy of all of its policy holders. If it ever happens that a policy holder has a change in circumstances or ends up having excessive claims which would end up making him or her looking like they cannot be insured then the insurance company might decide not to renew their insurance coverage. In other cases, it might be as a result of increase in premium which would reflect on the increase in risk.
Denied Claims
Even if you are a policy holder that always pay your premiums on time when it is appropriate and regularly, it still would not move an insurance company to approve or accept your claims when you file a claim. This might be because the situation surrounding the story behind the claim you filed might not be covered in your policy and it has probably been listed under exclusions. An example of this scenario is a homeowner dealing with flood and he goes on to file an insurance claim with his insurance company.
The truth is floods have no coverage under home insurance but under flood insurance so there is a high tendency that such claim would get denied. Furthermore, it is still very much possible that the claim you are filing might worth more than the deductible in your coverage and this simply means whoever the insured person is should be the one paying for it. Finally if the insurance company figures out that the damage was as a result of the insured’s actions then they can go ahead and deny the claim you have filed for.
Denied Policies
If the type of insurance that you have is one that carries or provides several lines of coverage then the insurance company is not obligated to approve any other claim which carries another additional coverage. In this situation, the insurance company is going to evaluate and underwrite the claim you have filed for as they would do with all other claims that have been submitted and based on the risks that they can presently see, they are either going to accept or approve your claim or end up denying it.
The Type Of Car You Drive
If you end up owning a high performance car, sometimes, it tends to affect or hinder your eligibility in obtaining auto insurance. Insurance companies believe that driving a Lamborghini would easily earn you the tag a high risk driver in insurance because you stand at a good chance of getting involved on a car accident and a claim from such accident would definitely rate the highest.
This is why vehicle drivers are obliged to pay attention to insurers when they assess vehicles depending on the engine size, safety rating, handling and engine speed. Insurance also have a way of associating vehicles with drivers and this means is if you driver a high performance vehicle then you can be labeled a high risk driver because you have high chances of being involved in a car accident.
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