People generally expect red tape during insurance claims. They know that insurance professionals negotiate aggressively and that they may need to present various forms of documentation to secure the policy payout that they deserve.
Unfortunately, sometimes insurance professionals cross the line between appropriate but aggressive professional conduct and outright misconduct. Despite laws regulating the insurance industry, some professionals make statements to policyholders that represent a clear violation of their rights and the terms of the policy in question. For example, they may claim that the deductible is higher once the policyholder files a claim.
Is it legal to increase a deductible in response to a claim?
Policy terms depend on the documents signed
Insurance companies do not have the authority to modify an existing policy because a policyholder files a claim. They should uphold the policy as issued until it comes up for renewal.
Deductibles are a standard component of many types of insurance coverage, such as homeowners insurance. People filing claims to repair their properties have to meet a deductible before coverage is available to them.
The amount of the deductible is one of the factors that influences the price of the policy. The deductible should remain the same for the duration of the policy until it is time to renew. It is not appropriate for an insurance company to try to increase the deductible in response to a claim, although the cost of maintaining a low deductible may increase after a sizable claim come renewal time.
People who have experienced bad faith insurance practices may need to file lawsuits. Pursuing bad faith insurance litigation can help people get the coverage they deserve and hold insurance companies accountable for refusing to uphold their policies.