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Insurance is there to provide you or your loved ones with financial security in the event that you suffer a covered loss. Your policy pays out according to its terms, but the payment isn’t always immediate. 

The process can often take days or weeks, from the steps you need to take, such as documenting evidence and filing the claim, to the steps the insurer will take on their end, including communicating with you and sending a claims adjuster (for property and casualty insurance).

Key Takeaways

  • The time it takes to process and approve an insurance claim depends on factors such as its complexity and the insurer’s guidelines.
  • A claim may be paid out within days, but it could also take several months, including filing the claim, waiting for an adjudication, and receiving payment.
  • You can make the process faster by providing accurate, thorough documentation with your claim.

Understanding the insurance claim timeline: from filing to payout

First, read your policy. It will tell you how much you can claim, what your deductible is, and if there are any limits for specific property types. You’ll also need to confirm that your policy covers the loss under its named perils provisions, as well as any rules you need to follow to mitigate further damage.

You’ll also need to take time to document everything. Depending on the state of the damage, you should budget enough time to look up the cost of anything lost or damaged. If the loss generated any bills, such as paying for someone’s medical care or repairing structural damage, you should also save those estimates. 

Once you file the claim form, some time may pass while the insurer conducts an investigation. This could include sending an adjuster to inspect the damage or loss and determine whether to approve your claim. Most states require insurers to wrap up their investigation within 10 to 30 days, although it may vary from state to state.

If you’re approved, the final step is to wait for the payout, but be sure to follow up with the insurer during this time. 

What impacts the time to approve an insurance claim?

Generally speaking, the more involved the claim is, the longer it will take to process.

“The amount of time it takes for a claim to be resolved depends on many different factors,” said Hugh Allen, the principal product strategist at Hi Marley, an online insurance platform. “For example, a simple fender bender involving two vehicles may take seven to 10 days to resolve liability and distribute payment.”

“A glass claim for windshield damage may be resolved in one day,” he adds. However, “for a total loss auto claim, it may take 20 to 40 days for a carrier customer to receive a settlement payment.”

The accuracy of documentation provided in the claim can also affect the approval process. Errors in your claim, including missing or incomplete documents, will cause delays.

In addition, the number of parties involved – multiple injuries in a liability claim or multiple damaged vehicles in a car accident, for example – can affect the time the claim process takes. Insurance companies must communicate with one another and the policyholders involved to ensure they receive the correct documentation and pay respective claims if required.

How to speed up the insurance claim process

While much of the claims process depends on the speed at which the insurer conducts its investigation, there’s a lot you can do to make the insurance claim process more seamless.

First, contact your insurance company immediately. “To make any claims process more efficient, consumers should have their policy number and a copy of their policies handy,” Allen said. 

While the insurer will likely be unable to act on your claim right away, they will get the process started and can guide you through the next steps. The insurer will continue reaching out to you to get more information, so be sure to respond to your insurer promptly when they communicate with you, and don’t be afraid to follow up with them when you haven’t heard anything.

You’ll also need to document everything in as much detail as possible. That means taking pictures or video of the aftermath and tallying up the costs of property damaged or lost. 

“For a large property loss, make sure to keep an inventory of your valuables and submit receipts for valuables to reduce complexity around appraisals,” said Allen. 

If you don’t have receipts on file, you can estimate the costs of the lost or damaged property. Start getting quotes for repairs or replacements, and be sure to talk to your insurer about the repairs as they may have contractors they prefer to work with. 

The sooner you have this information on file with the insurer, the faster they can start processing your claim.

Reasons for insurance claim delays

Your claim could be delayed due to several factors, which may or may not be within your control. Some of the most common reasons that claims are delayed include:

Incomplete documentation: You must provide the insurer with as much information as possible when filing a claim, including an inventory of damaged or lost property, estimates and actual repair costs, and visual evidence of the loss. If a police report was filed, you should include that, too. If your records are incomplete, that may slow the settlement process.

Disputes over coverage or liability: Your insurance policy is a contract between you and your insurer, but how each party interprets its terms can vary. You may disagree with your insurer about whether a loss is covered and may be asked to provide evidence to support your assertion. For example, an insurer could try to deny your claim if you were negligent in mitigating the loss before it happened, but you might have evidence proving otherwise. Resolving disputes like these takes time.

Complex or high-value claims: As discussed above, the complexity of the claim will increase the time it takes to resolve. Your insurer will need to systematically determine which of the damages is covered by your policy and what portion of the costs they’re responsible for.

Third-party reports: The insurer won’t be able to determine costs until third-party information is received. An example of this would be a liability claim in which a person is injured in a covered accident. The medical professionals who provided the person’s care may need to prepare a separate report for their insurance company, who will share it with your insurance company to determine your obligation.

How long does it take to receive a payout after a claim is approved?

When your claim is approved, the insurer will either mail you a check or deposit the money into your bank account. For that reason, you need to make sure your mailing address is up to date or, if you’re receiving direct deposit, that your bank account details are accurate. Any errors here could cause significant delays.

But if everything is accurate, you should receive the payout within five to 10 business days.

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Zack Sigel

 
  

Zack Sigel is a writer and editor based in New York City. He has been managing editor at Policygenius and M1 Finance, where he led teams specialized in writing about business and finance, and he has also written about music and culture for Hyperallergic, VH1, Complex, and the Los Angeles Review of Books. Zack has a bachelor's degree from New York University, Tisch School of the Arts.

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