View Poll Results: Are insurance companies required to pay their claims?

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  • Yes

    7 63.64%
  • No

    3 27.27%
  • No, not if their is an extreme situation.

    1 9.09%
  • You're an a*****. I hate you.

    0 0%
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Thread: Are insurance companies required to pay their claims?

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    Are insurance companies required to pay their claims?

    Are insurance companies required to pay their claims if they don't have the cash on hand to do so?

    For example: If a hurricane hits all policy holders within a hundred mile radius.
    For example: They don't feel like paying your claim.
    For example: Your situation is the one thing that isn't covered in your policy.

    If this is true, What good is insurance?

    vasuderatorrent

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    Re: Are insurance companies required to pay their claims?

    If they are contractually required to pay out then yes they have to pay it.
    If it isn't covered, of course not.
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    Re: Are insurance companies required to pay their claims?

    Quote Originally Posted by vasuderatorrent View Post
    Are insurance companies required to pay their claims if they don't have the cash on hand to do so?

    For example: If a hurricane hits all policy holders within a hundred mile radius.
    For example: They don't feel like paying your claim.
    For example: Your situation is the one thing that isn't covered in your policy.

    If this is true, What good is insurance?

    vasuderatorrent

    I say yes.If they didn't want to pay claims then they shouldn't be in the insurance business. Personally I feel that homeowners insurance should pay for all damage that is not your fault.You shouldn't need a separate "Douche bag ran into your home", "meteor hit your house", "sink hole swallowed your home" or any other excuse insurance companies try to use to weasel out of paying you.
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    Re: Are insurance companies required to pay their claims?

    Quote Originally Posted by vasuderatorrent View Post
    Are insurance companies required to pay their claims if they don't have the cash on hand to do so?

    For example: If a hurricane hits all policy holders within a hundred mile radius.
    For example: They don't feel like paying your claim.
    For example: Your situation is the one thing that isn't covered in your policy.

    If this is true, What good is insurance?

    vasuderatorrent
    If it is not something covered in your policy, they do not have to pay. Be sure to read your policy. In Canada overland flooding is very hard to get insurance for so a lot of people in southern Alberta did not get any insurance coverage from floods in June

    If the company does not have the money to cover the insurance payouts, it will or should go bankrupt and unfortunately the people waiting for payouts will be SOL
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    Re: Are insurance companies required to pay their claims?

    Quote Originally Posted by vasuderatorrent View Post
    Are insurance companies required to pay their claims if they don't have the cash on hand to do so?

    For example: If a hurricane hits all policy holders within a hundred mile radius.
    For example: They don't feel like paying your claim.
    For example: Your situation is the one thing that isn't covered in your policy.

    If this is true, What good is insurance?

    vasuderatorrent
    Example 1, yep, they have to pay. Happens frequently. They hem and haw about what they actually cover, but in the end, they have to pay for what was insured.

    Example 2, yep, they have to pay. Where do you think all those accident lawyers get their money for all those commercials? If the insurance company doesn't want to pay, then they get sued and are out the settlement plus court costs.

    Example 3, no, if it ain't in the policy as covered, then they don't have to pay for it.

    If they don't have cash on hand, that is what corporate loans are for. Otherwise, then they go bankrupt or sell off assets to get the money. Our they may delay paying some until the next months premiums come in.
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    Re: Are insurance companies required to pay their claims?

    Can you explain what you mean by required?

    Do you mean by force of the government or what?

    This is a business contract just like any other and if the insurance company doesn't pay they have to show in court why not.

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    Re: Are insurance companies required to pay their claims?

    Quote Originally Posted by vasuderatorrent View Post
    Are insurance companies required to pay their claims if they don't have the cash on hand to do so?

    For example: If a hurricane hits all policy holders within a hundred mile radius.
    For example: They don't feel like paying your claim.
    For example: Your situation is the one thing that isn't covered in your policy.
    If this is true, What good is insurance?

    vasuderatorrent
    I didn't see your caveat about the co. not having the cash on hand. I voted no, because right now, whether or not a claim is valid is subjective and up to the ins. co. to decide. Some cos. have people on staff whose job it is to find some way not to pay a claim.

    However, starting 1/1/14 the ACA ties the amount of claims paid with premiums paid. For group policies, if an ins co. does not pay at least 85% of premiums collected on payment of claims, it is required to refund the premiums to get the ratio up to 85%. For individual policies, the amount required to pay is 80% of premiums collected. There will no longer be a need to have people on staff to find ways to deny claims, since presumably more will be paid.

    As for property insurance, I guess the situation remains the same. Some states (or all of them?) require the ins. cos. to have a certain amount of cash on hand for payment of claims, so I don't think that situation is run into very often, unless the co. has been fraudulent in its reporting to the state insurance commissioners.

    It's been my observation and experience that ins. cos. pay legit property claims. It's usually the AMOUNT they pay that's the problem.

    Insurance is better, I guess, than not having anything as protection against catastrophe.

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    Re: Are insurance companies required to pay their claims?

    It looks like, according to our audience that insurance companies are required to pay out their claims. Thank you to all 11 participants.

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    thanks so much

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