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Detailed Answer

If your insurer stalls or denies your collision claim in Alabama, you have rights and remedies under state law. First, document every communication and gather key evidence: the police report, repair estimates, photos of vehicle damage, medical records (if any), and the insurer’s written reasons for delay or denial.

1. Review Your Policy and Insurer’s Explanation

Carefully read your insurance policy. Identify coverage provisions, deadlines, and your insurer’s obligations. Under Alabama Code 727-12-1 et seq. (Unfair Claim Settlement Practices), insurers must investigate and settle claims fairly and promptly.

2. Send a Formal Demand Letter

Draft a concise demand letter outlining the facts, policy provisions, amount owed, and a deadline (usually 10–14 days) to resolve the claim. Cite Alabama727-12-24, which prohibits insurers from engaging in “bad faith” tactics such as refusing reasonable settlement offers within policy limits.

3. File a Complaint with the Alabama Department of Insurance (ADOI)

If the insurer ignores your demand, submit a complaint online or by mail to the ADOI. Provide a copy of your policy, communications, and demand letter. The ADOI oversees insurer conduct and can investigate unfair practices: Alabama Department of Insurance Consumer Center.

4. Consider Extracontractual Damages

Under Alabama Code 76-5-580, you may pursue extracontractual or “bad faith” damages if the insurers unreasonable delay or denial causes you additional losses (e.g., rental car costs, diminished vehicle value, emotional distress). Consult an attorney to assess your potential award.

5. Seek Attorney’s Fees

If you win on your bad faith claim, Alabama Code 76-6-20 allows recovery of reasonable attorneys fees and court costs. This provision discourages insurers from delaying or denying valid claims.

By following these steps—documenting your claim, using a demand letter, involving the ADOI, and understanding your right to bad faith and fee-shifting remedies—you can challenge delay or denial tactics effectively under Alabama law.

Disclaimer: This article is educational only and does not constitute legal advice. For advice specific to your situation, consult a licensed attorney.

Helpful Hints

• Keep a detailed log of all calls, emails, and letters with your insurer.
• Send communications via certified mail to track delivery.
• Obtain multiple repair estimates to support your claim amount.
• Check the ADOIs website for complaint status updates.
• Act quickly: Alabamas statute of limitations for breach of contract is six years (Ala. Code 76-2-34).