Why insurance companies may fail to pay filed road accident claims

To err is human, and accidents are inevitable. The value of an insurance policy thus cannot be understated. In Kenya, the law requires all vehicles, regardless of category, to have insurance coverage.

At the heart of their operations, insurance companies aim to maximize profits, while insured individuals get a sense of security in case of an accident.

Generally speaking, most insurance claims are paid out. However, many customers still find themselves in disputes with insurers over the fine print in their policies.

In some cases, insurance companies may delay claims, create bureaucratic hurdles, or refuse to pay altogether.

Before escalating the issue, it’s essential to understand why the insurance company has withheld payment. Here are some common clauses insurers often use to avoid liability:

Your claim application was inaccurate

When filing an insurance claim, being dishonest or withholding details about the incident can lead to serious repercussions, including the cancellation of your policy.

Misrepresenting facts, inflating the extent of damages or faking accidents may result in your claim being denied and could even expose you to legal action.

You failed to follow the claims process

Insurance companies usually require accidents to be reported within a set time, that is between 24 to 48 hours. Failing to report promptly can hinder investigations and may lead to the claim being rejected.

Failing to renew your insurance policy on time means you lose coverage. If an accident occurs during this lapse, the insurer has no obligation to pay for any damages.

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Your claim doesn’t meet the criteria in the policy terms

Claims can be rejected if proper documentation, such as a police report, accident scene photos, or medical records for injuries, is not provided. Insurers rely on such evidence to evaluate and process claims accurately.

Insurance policies, furthermore include exclusions specifying situations where claims won’t be covered.

For example, if the accident happened while the driver was under the influence of alcohol or drugs, the insurer is unlikely to honour the claim.

Your claim falls in the wrong category

Claims may also be denied if the vehicle was being used for purposes not covered by the policy. For example, using a vehicle insured for personal use for commercial activities could void the coverage.

You violated the law prior to making the claim

Insurers may reject a claim if the driver violated traffic laws, such as reckless driving, driving without a valid license, or speeding. These actions show negligence that will obviously be excluded from coverage.

Similarly, suppose the driver who caused the accident is uninsured and the policyholder’s coverage does not include uninsured motorist protection. In that case, the insurer is unlikely to cover damages or injuries from the accident.