What To Do When Your Car Insurance Company Refuses to Pay

Can a car insurance company refuse to pay a claim? Oregon car accident attorney Aaron DeShaw answers your questions and more.

Perhaps this is a familiar story to you: you pay your premiums on time every month. You have few (if any) driving infractions, and you always drive safely and defensively. Then, one day, another motorist hits you from out of nowhere—and you have to file your first car insurance claim.

You may be full of questions: What if the auto insurance company refuses to pay for the rental car or hospital bill? What if the car insurance company refuses to pay for an MRI? 

What happens when a car insurance company refuses to pay for anything, denying your claim outright?

Many policyholders are surprised by how difficult working with their insurance company can be — and all the more so in “third party” claims, where you’re dealing with the insurance company of the person who hit you. Our law firm specializes in motor vehicle accidents: particularly cases where your insurance company refuses to pay, or delays your payment indefinitely.

The Law Offices of Aaron DeShaw, Esq., P.C. has written the ultimate guide on what to do when your car insurance company refuses to pay. 

Why is my car insurance company refusing to pay?

The answer is simple: the insurance industry is a for-profit enterprise, and claim denial is part of their business model. They are only motivated by profit, and any time they have to pay a car accident claim, it cuts into this goal. The only way to motivate them to action is by holding them to their contractual obligations — which means paying promptly and fairly on all legitimate claims. In the absence of good-faith cooperation, you may need to hire a lawyer to represent you.

Contact DeShaw Law, Oregon Insurance Bad Faith Lawyers: (503) 227-1233.

6 Facts Your Insurance Company Doesn’t Want You To Know

Fact #1: Insurance companies put profits over people.

Contrary to popular belief, insurance companies do not work for you; they work for their shareholders. Looking after your needs — the needs of their paying customers —is actually not their primary goal. Their goal is to look after their bottom line and make more profit every quarter.

How do insurance companies make money? 

Insurance companies use the money collected from your premiums to invest. No matter how folksy their marketing campaign or how personable their insurance rep is, your insurance company depends on more money coming in than going out.

And insurance companies will do anything to keep your money in investments that pay out … for THEM. Insurance companies will always put profits over people. Like any for-profit company, profit is their primary motivator. To get insurance companies to do the right thing, use the incentive that works for them: profit. 

Why hire a personal injury lawyer?

By hiring an attorney, you motivate your insurance company to pay your claim. This is because drawing out a legal battle will almost certainly cost them more than simply paying what they owe on your claim.

Insurance companies are not motivated to “do the right thing” for their policyholders. Therefore, threatening to be a bigger drain on their profit margin is the most reliable way to motivate them to pay the full value of your claim.

DeShaw Law is a boutique insurance bad faith law firm, located in Portland, Oregon. Contact us today to discuss your case: (503) 227-1233.

Fact #2: Insurance companies live by the "3 Ds": Delay, Deny or Defend.

Most insurance claims are straightforward “fender bender” issues where liability is clear, and damage is minimal. For these claims, insurance companies generally pay promptly and fully.

For larger, more complicated claims — particularly claims involving medical costs — insurance companies put away their “good hands” approach and get out their boxing gloves. Because high-value claims can cut heavily into their profits, insurance companies switch to delaying or denying your claim — and defending their financial interests at great cost.

In the 1990s, certain damning consulting documents came to light that showed, conclusively, that insurance companies were colluding together to keep premiums high and payments low throughout the industry. In what came to be known as “The McKinsey Documents”, McKinsey — the same consulting firm accused of fanning the flames of America’s opioid crisis — suggested that insurance companies switch to the Delay-Deny-Defend model to protect their financial interests.
Delay: Dragging out the settlement process to drive claimants away

If you have ever tried to settle your own claim without an attorney, you’re probably familiar with the common insurance company’s reply: “We need more information.” This is code for: “We are going to delay your claim in the hope that you forget about it and just give up.”

“Delay” is the first tactic insurance companies use to shirk their financial responsibility. They will make you go after documents that are classified, hard to find, or sometimes completely irrelevant to your claim. Once you’ve provided them with the documents they requested, they’ll often tack on additional requests that prolong your settlement payout.

A competent personal injury attorney will protect you from abandoning your insurance claim and leaving money on the table. Your attorney will act as the intermediary between you and your claims adjuster, providing them with the information they request — while staying on them to provide a full, fair evaluation of your claim.

Why do insurance companies delay claims? 

Insurance companies find reasons to delay your claim because it buys them time. It gives them an opportunity to earn interest on their corporate investments — literally earning interest on the money they owe you — and gives you a chance to get frustrated, overwhelmed or simply defeated before giving up. This happens with alarming frequency.

Plaintiff attorneys write “demand letters”, or letters explaining your case and settlement requests, to insurance companies. This establishes a third-party relationship at which point the insurance company will only deal with your attorney, not with you. Your attorney will give them a deadline to pay or resolve your claim, after which they will seek damages through the legal system. An experienced attorney will have ample resources to make this process as quick and easy for you as possible.

Many insurance claims settle fast with the introduction of an attorney. This is because they are betting that most claimants will not fight for every penny they are owed.

Deny: Everything you say is wrong.

Even when liability is clear and your claim is valid — like in a hit and run, or in most rear-end collisions — your insurance company may still deny responsibility. This can often follow moments where you have done everything right, from years of safe driving and paying your premiums on time to filing your claim promptly after the accident and cooperating with their information requests. 

Insurance adjusters are skilled tacticians at keeping you from receiving a check. They might tell you your claim is invalid based on a clause in your policy you were not aware of, or tell you that their policy, for whatever reason, is to deny claims like yours. Sometimes they will even claim that they’ve tried to get in touch—when you have been the one trying to get in touch with them.

In other cases, the insurance company may ask for a recorded statement from you before they will resolve your claim. Our advice is to consult your attorney before offering a recorded statement to your auto insurance company. You may have to give a statement for first-party claims, but you are not required to give any statement to a third-party insurer. To learn more about your rights with regard to giving recorded statements, click here.

When your car insurance company denies your claim, do not hesitate to contact your personal injury attorney at The Law Offices of Aaron DeShaw, Esq., P.C.; Oregon has a strict statute of limitations that may affect the validity of your claim.

We will immediately evaluate your claim and contact the insurance companies to intercede on your behalf. Once your lawsuit is filed, we will help navigate every step with you, making sure you receive what you are owed

Defend: From “Good Hands” to Boxing Gloves

Once you have hired a lawyer and your suit is filed, insurance companies switch to tactic #3:  defending their refusal to pay your claim.

In many cases, claims go through a mediation process where representatives from each side work to reach a settlement or mutually agreed upon financial arrangement. In cases where a  fair settlement cannot be reached, you can (1) take their lowball offer and walk, or (2) file a lawsuit and take the case to trial, where your claim will be evaluated by a judge and jury.

Be aware: not every personal injury attorney is willing, or even able, to take your claim to court. Insurance companies recognize that many personal injury attorneys are not trial-ready, and will essentially “call their bluff” by holding firm to a lowball offer. This is why it is critical to find a personal injury attorney with trial experience; it may never come to that, but your attorney’s reputation may be the deciding factor in how seriously your insurance company takes your claim.

In many cases, the insurance company will defend the claim as long as possible. Some insurance companies have even set up dedicated law offices with specialist attorneys who are trained to fight on behalf of the insurance company. Many of these lawyers get a set salary to simply defend cases just like yours, every day.

But that’s not all: insurance companies also have in-house CME doctors who make six-figure salaries simply to examine injured claimants and downplay the severity of what they see. These IMEs, or independent medical examinations, are another way the insurance companies pull out all the stops to defend against paying what they owe.

Moreover, insurance companies may hire investigators to try to catch you doing something that will compromise the value of your case, or check your social media pages for indications that you aren’t as badly hurt as you say you are. From in-house engineers who will say your car couldn’t be that damaged, to crash reconstructionists who will testify that you can’t be that badly hurt, the insurance company has the infrastructure to make collecting on your claim almost impossible.

Put simply: Insurance companies have attorneys and specialists working hard on their side — and when you need to defend your claim, you need an attorney on your side as well. Contact DeShaw Law today to discuss your case: (503) 227-1233

Fact #3: Hiring a lawyer can increase the value of your case.

We know that insurance companies put profits over people. We know that they intentionally delay, deny, and defend paying legitimate claims to maximize their profits.

After all the information above about insurance companies’ unscrupulous behavior, it may seem hopeless. 

Now for some good news: hiring an attorney will often even the scales again so you can get your claim resolved and return to your life — and the reputation of the attorney you hire can make a difference in how much your case is worth.

Did you know? 

Having a lawyer frequently leads to higher amounts of compensation. One survey found the average settlement/award for readers with attorneys was $77,600, compared to $17,600 for those who handled their own cases. Even after deducting the legal fees, represented parties reported payouts three times higher than unrepresented parties.

Insurance companies seek to maximize their profits — and that means holding your money as long as possible. Your secret weapon is hiring a dedicated personal injury attorney with experience in car accidents, truck accidents, pedestrian/bicycle accidents, wrongful death, traumatic brain injury, and/or insurance bad faith.

If your insurance company is not cooperating with you, you need to hire an attorney.

Filing a lawsuit is sometimes the only way to improve your case outcome. When you even threaten to let a jury of your peers decide what is fair compensation, you essentially require them to decide if denying your claim is worth the time, effort and possible public rebuke of a jury trial.

How soon should I hire a personal injury attorney after my accident?

Speak to a personal injury attorney as soon as you believe your insurance company is delaying or wrongly denying your claim, but you can also seek and retain representation before you have contacted your insurance company. Some people call their attorney even before filing a police report.

When you hire an experienced, board-certified civil trial lawyer to represent you, you are signaling that you believe your case is worth the added time and expense. Studies show that hiring an attorney improves the outcome of your case, and most personal injury firms work from a contingency fee, where they only receive compensation if they get money for you. 

We believe you should always talk to an attorney before pursuing your claim. Filing a suit forces your insurance company to take your claim seriously — and guarantees that you will receive your day in court, should it come to that.

DeShaw Law has been fighting insurance companies for more than two decades. Call us at (503) 227-1233 to discuss your case.

Fact #4: Your insurance company already knows your lawyer — and your doctor, too.

The value of your claim is based on the caliber of lawyer you hire — and yes, insurance companies keep track records on every lawyer they encounter. Cases represented by “settlement mill” lawyers, who take on lots of cases and routinely settle for lower sums, may see only a marginal increase in settlement offer. Cases represented by trial lawyers — particularly those with a proven record of high settlements or verdicts — will receive higher settlement offers and faster resolutions.

Put another way: if car insurance refuses to pay after you’ve hired a lawyer… it may be because they know the lawyer, and don’t take them seriously.

Attorney Tip:

Always hire a lawyer with a good reputation. Integrity, trial history, and objectivity are critical attributes here. One classic sign to look for: during your case intake, your attorney should go over the strengths and the weaknesses of your case. A good attorney will be able to anticipate the defense’s counterarguments, and proffer solutions that speak to every angle of the case. Contact DeShaw to find out how we can help: (503) 782-9750.

Make sure your attorney is known for keeping their word, rejecting lowball offers, and pushing cases to trial. (Hiring a trial attorney is important even if you think that you will not go to trial because insurance companies will pay more to avoid that credible risk.)

Insurance companies risk losing money on you when the value of your case is no longer theirs to determine. Sadly, the threat of a jury trial is sometimes the only way to motivate an insurance company to pay out the full value of your claim.

Similarly: your insurance company meticulously tracks every medical provider you see. They can do this through medical billing, which is done electronically through your Federal Tax ID number, which also appears on your medical bills.

The reputation and integrity of your medical team are just as important as that of your attorney; insurance companies recognize that high-volume chain clinics can often inflate the value of your medical bills — and they will decrease your claim payout commensurately.

Always invest in your medical care by choosing medical professionals who have established reputations for fairly priced, high-quality care. Not only will better doctors make better witnesses, should you need them to testify on your behalf, but your insurance company will recognize this and be more inclined to take your medical costs seriously.

Choosing an experienced, high-caliber doctor — and lawyer — sends a powerful signal to your insurance provider. When you take your case seriously, the insurance company will take your case seriously, too.

Located in Portland, Oregon, DeShaw Law is a premier insurance bad faith law firm with more than 20 years of experience fighting insurance companies on behalf of Oregonians. Contact us today to discuss your case: (503) 227-1233

Fact #5: Insurance Companies Don’t Want to Go to Trial Against a Trial Lawyer

Your claims adjuster, and the insurance company’s legal team, deal with cases like yours every day. They know how the game is played: protect the financial interests of the company by delaying, denying, and defending nonpayment of high-value claims. They know to be wary of cases represented by experienced personal injury attorneys — and they want to avoid the cost and risk of trial by any means necessary.

Many jurors will have experienced the challenge of getting their own Insurance company to cooperate. Because their reputation precedes them, insurance companies have the weakest tactical advantage in court. For this reason — under the credible threat of going to trial — many claims settle out of court just before the trial begins.

When a car insurance company refuses to pay, hiring a lawyer and threatening to take them to court will often motivate them to action. They will sometimes only pay what your case is worth to avoid losing at trial. 

Why don’t insurance companies want to go to trial? 

In many cases, verdicts are much higher than the amount your insurance company claims your case is worth. Many verdicts make insurance companies pay for damages that would not have been factored into earlier settlement amounts. This includes things like legal fees and pain and suffering. In some cases, the jury may even assign punitive damages when it is proven that the insurance company acted in bad faith.

Here is a little-known fact outside the industry: insurance defense attorneys are frequently overworked. They typically have a much higher caseload than plaintiff attorneys, representing injured clients. They frequently express frustration that their employer will not pay out more to settle claims — but why would they? Profit is the insurance company’s #1 goal, and that’s as true for their employees as it is for their policyholders. Lead Attorney Aaron DeShaw is one of less than 100 lawyers and judges in Oregon selected for the American Board of Trial Advocates. Our lawyer is known nationwide in the personal injury field as one of the best Oregon trial attorneys. Contact our Oregon trial lawyer to discuss your case: (503) 227-1233

Fact #6: Most personal injury lawyers never go to trial.

The truth is: many lawyers will never see the inside of a courtroom. They work on a quantity-over-quality model, taking every case they can get and settling quickly. Going to trial requires tremendous risk, patience, and dedication to your client’s case. Not every lawyer is prepared to take on this burden in the name of their clients.

When your insurance company refuses to pay, it’s often because they don’t believe you would take them all the way to trial. This could be because you do not have a lawyer — or because your lawyer does not present a credible threat.

Do you need an insurance bad faith attorney? Our team of experienced insurance claims lawyers stand ready to represent you. Call our offices today for a free, no-obligation consultation: (503) 227-1233

About the

Aaron DeShaw is a personal injury lawyer at DeShaw Trial Lawyers, a law firm representing injured people with serious injuries including brain injuries and other catastrophic injuries. He has individually, and in association with other law firms, obtained over $1 Billion for his clients. Learn more about Aaron and the Firm.