Disclaimer: This article is for educational purposes and does not constitute legal advice. It does not create an attorney-client relationship.
Understanding Unfair Delay and Denial Under Minnesota Law
After a collision, Minnesota law prohibits unfair claim settlement practices. Under Minn. Stat. § 72A.20, insurers must investigate claims promptly, respond within a reasonable time, and provide a reasonable explanation for any denial or delay.
Steps to Challenge Delay or Denial Tactics
- Review Your Policy and Communications. Check your declaration page and any correspondence. Note deadlines for proof of loss and other policy requirements.
- Send a Written Demand. Draft a demand letter outlining the facts, claim amount, legal basis under your policy and Minnesota law, and set a reasonable response deadline. Send it by certified mail.
- File a Complaint with the Minnesota Department of Commerce. If your insurer still delays or denies without proper explanation, visit mn.gov/commerce to file a consumer complaint. The Department can investigate statutory violations and may order corrective action.
- Consider Alternative Dispute Resolution. Check if your policy includes appraisal or mediation clauses. ADR can provide a faster resolution and demonstrate your willingness to negotiate in good faith.
- Consult an Attorney. If the insurer’s tactics continue to harm your claim, an attorney experienced in insurance disputes can help you pursue contractual remedies, statutory penalties, and recovery of attorney fees.
Potential Remedies and Legal Options
You may bring a breach of contract action in Minnesota District Court. While Minnesota does not recognize a standalone private cause of action for first-party bad faith, courts may award extra-contractual damages when an insurer’s conduct violates Minn. Stat. § 72A.20. You can also seek recovery of attorney fees under Minn. Stat. § 549.20.
Helpful Hints
- Maintain a detailed timeline of all communications with your insurer.
- Keep copies of all letters, emails, repair estimates, and medical records.
- Send key correspondence by certified mail or another trackable method.
- Be clear and concise in your written demands, stating legal and policy bases.
- Document every call with date, time, name of representative, and summary of discussion.