What is an Insurance Claim?

Application for benefits provided by the insurance company in actual is insurance claim. Policy holders have to file first insurance claim before any money can be disbursed to the hospital or repair shop or other contracted service. It depends on the insurance company that they approve or reject your claim depending on their own assessment of the circumstances.

It’s necessary for the people who purchase the home, life, health, or automobile insurance policies must deposit the premiums on regular basis to the insurers. Usually these premiums are to settle another person’s insurance claim or to enhance the available assets of the insurance company. But sometimes accidents also happen which cause the financial damage, for example automobile wreck, tornado or a work related accident. In such cases the policy holder is having the right to file the insurance claim for receiving money from the insurance company.

The insurance claim is filed to the local representative of the insurance company. The local representative is responsible to inquire about the specific details of the insurance claim, and negotiate the payment from the main insurers. A recognized authority such as doctor, repair shop, building contractor can file the insurance claim forms directly with the insurance company. Sometimes policy holders do not file an actual insurance claim if the damage is minor or other party agrees to pay out of pocket for their mistake.

When the insurance claim is filed then insurance company send out an investigator, which is called adjuster or appraiser. The investigator’s job is to assess the insurance claim and decide if the repair estimates are reasonable. This is done to prevent the possible fraud by contractors who may inflate their bills for additional compensation. Investigator’s assessment is final word for insurance companies on the insurance claim.

Sometimes insurance claims are not approved by the insurance companies for any number of reasons. That can be because of claimant’s premiums, which are not paid in full, or the policy itself is not active. In case of automobile insurance policies if the damage caused by carelessness then the insurance company is having right to withhold payments.

Insurance claim remain only a claim until the insurance company assess the situation. Insurance claim is the only way to officially apply for benefits under an insurance policy.