You can cancel an insurance claim. However, you should know that even if you cancel a claim, you might still face increased premium payments, particularly if you filed a claim for an accident you caused. You should have a good reason to cancel an insurance claim before doing so, and an insurance bad-faith lawyer can help you weigh your options.
You might withdraw an insurance claim for several reasons. A meager financial payout, a high deductible, and mental health difficulties stemming from the claims process are just a few reasons why you might cancel a claim. Just be sure that you’re withdrawing a claim for the right reasons.
Why Might I Cancel an Insurance Claim?
The claims process can be complicated, time-consuming, and stressful for claimants. The juice is not always worth the squeeze. You might decide to cancel an insurance claim because:
The Insurance Company is Offering Very Little Compensation
Insurance companies might offer little compensation because:
- You have a high deductible that your losses barely exceed.
- The insurance company assesses your loss at a lower value than you thought it would.
- The incident in question did not cause significant property damage.
Sometimes, a low settlement offer is an insurance company’s attempt to underpay you. While fighting for a larger settlement is sometimes a wise course of action, in other cases, withdrawing the claim may make the most sense.
You Don’t Want to Pay the Cost of the Deductible
When determining the value of an insurance claim, you must consider the deductible. If you would have to pay a $2,000 deductible to receive a $250 payout from the insurance company, you may choose not to.
If you withdraw the claim, you can decide whether to pay for property repairs on your own. You might choose to complete cheaper repairs or no repairs at all and keep the $2,000 you would have otherwise paid toward the deductible.
You Cannot Handle the Stress or Demands of the Claims Process
For some claimants, even the prospect of compensation is not enough to trump the unpleasant aspects of the claims process. Claimants may be particularly bothered by:
- Unfriendly interactions with insurance companies
- An interrogation-like feeling to insurers’ information-gathering techniques
- Seemingly endless requests from insurance companies
- Unexpected contact from insurance providers
- Allegations that the claimant is responsible for their unfortunate circumstances
There can be an adversarial element to some insurance claims. Some claimants would rather withdraw the claim, say “forget about it,” and deal with their losses than tolerate an unpleasant claims process.
The Claims Process is Taking too Long
Claimants often envision the claims process being a straightforward, cut-and-dried process. The truth is that claimants never know exactly how long the claims process will take. If the process seems like it is dragging on, you might decide to withdraw the claim.
The Claim was Denied
Insurance companies have many possible reasons for denying a claim. If you receive a denial, appeal, and then change your mind, you might withdraw your appeal. You might feel that the insurance company is unlikely to change its initial ruling and that the effort and time required to appeal is not worth it.
Some claimants may even file a claim by mistake. This would be yet another reason to cancel an insurance claim, though this circumstance is not particularly common.
When Can’t I Cancel an Insurance Claim?
While you can often withdraw an insurance claim, you might not be able to cancel a claim if:
- The claim was filed against you (like in the case of someone filing a claim with your insurer after you caused a car accident).
- The insurance company says you are too far along in the claims process to withdraw (and you cannot effectively challenge its decision).
- You have already agreed to a settlement with the liable insurance company.
- You have engaged in another formal agreement that prohibits canceling the claim.
There are also circumstances in which you might be eligible to cancel a claim, but it would be wise not to.
Why Shouldn’t a Claimant Cancel their Claim?
Claimants can sometimes be their own worst enemies. Some claimants may cancel a claim in a rash manner that, if they had spoken with an attorney first, they would have thought better of.
You should not typically withdraw an insurance claim if:
- You have hired an attorney, as they will make the claims process far easier.
- You still have a chance of receiving a significant financial recovery.
- You are currently engaged in negotiations with insurance companies.
- You have serious or catastrophic injuries, which will be costly and affect your life for years to come.
- You face potentially serious financial or non-economic losses, as foregoing an insurance settlement could leave you with substantial out-of-pocket expenses.
Some claimants cancel their claims in the hopes that they can avoid higher premium payments. This is not generally a good reason to withdraw a claim. Once you file the claim, the insurance company has formal notice of the accident or other event for which you filed the claim. Your premiums may go up regardless of whether you cancel the claim.
Why You Should Speak with an Attorney Before Withdrawing an Insurance Claim
Canceling an insurance claim is a major decision. Withdrawal of a claim may be something you cannot undo. Speak with an attorney before making such an important decision, as a lawyer will:
- Help you determine whether there is any good reason to withdraw the claim
- Inform you of the potential downsides of canceling the claim
- Explain how they may help should you decide to proceed with the claim
If you filed the claim, you probably did so for a good reason. It’s wise to think twice before shutting the claims process down.
Call GED Lawyers Today to Discuss Your Insurance Claim
GED Lawyers has fought for our clients since 1995, and insurance claims are a critical focus for our attorneys. Whether you were in an accident, filed a property damage claim, or simply need advice about the claims process, we can help.
Call GED Lawyers today for your free consultation about a Florida insurance claims attorney.
