Understanding Your Rights Against Delay and Denial Tactics by Insurers in Virginia

Disclaimer: This article provides general information only and does not constitute legal advice. Consult a qualified attorney for advice regarding your specific situation.

Detailed Answer

When an insurer delays or denies your collision claim without a valid reason, Virginia law offers several remedies. Insurers must act in good faith and comply with the Virginia Unfair Claim Settlement Practices Act, Va. Code § 38.2-517. If they violate these rules, you can challenge their tactics through internal appeals, regulatory complaints, and, in some cases, a bad-faith lawsuit.

1. Review Your Insurance Policy

Begin by carefully reading your auto insurance policy. Identify your collision coverage limits, deductibles, and the procedures for filing and appealing a claim. Policies often require you to cooperate and provide timely documentation.

2. Gather and Document Your Evidence

Collect all relevant evidence: the police report, photos of vehicle damage, repair estimates, medical reports (if applicable), and correspondence with the insurer. Organize these documents chronologically to demonstrate diligence.

3. File an Internal Appeal with the Insurer

If the insurer denies or delays your claim, submit a written appeal. Under Va. Code § 38.2-517 (https://law.lis.virginia.gov/vacode/title38.2/chapter5/section38.2-517/), insurers must acknowledge appeals promptly and conduct a reasonable investigation. In your appeal, refer to specific policy provisions and attach supporting evidence.

4. File a Complaint with the Virginia Bureau of Insurance

If the internal appeal fails or goes unanswered, you can file a complaint with the Virginia State Corporation Commission’s Bureau of Insurance. The Bureau investigates unfair settlement practices and can order the insurer to comply. Submit your complaint online at https://scc.virginia.gov/pages/Insurance. Include copies of all correspondence, your policy, and evidence of the insurer’s unreasonable delay or denial.

5. Consider a Common Law Bad-Faith Lawsuit

In Virginia, you may have a tort claim for insurer bad faith if the company unreasonably denies or undervalues your claim. To prevail, you must show:

• The insurer had no reasonable basis to deny or delay payment.
• You complied with your policy obligations.
• You suffered financial harm because of the delay or denial.

Consult an attorney to evaluate the strength of a bad-faith claim and to calculate potential damages, including interest, consequential losses, and attorney’s fees.

Helpful Hints

• Keep a detailed log of all calls, emails, and letters exchanged with the insurer.
• Send all correspondence by certified mail with return receipt to track delivery.
• Ask for written explanations of any delay or denial and note any missing documents they claim you failed to provide.
• Review deadlines in your policy and Virginia statutes to avoid missing critical appeal or filing dates.
• Consider hiring an independent appraiser or adjuster if the insurer undervalues damage estimates.
• Be polite but firm in all communications; maintaining professionalism can strengthen your case.