Insurance claim denied: what to do next

Step 1: Get the denial in writing and find the reason

Do not work from a phone call. If your insurer refuses payment or ends your coverage, you have the right to appeal the decision and have it reviewed by a third party, and insurers have to explain why they denied the claim and tell you how to dispute it^source. For a health plan covered by federal law, the denial notice has to give the specific reasons for the denial, point to the plan provisions behind it, describe the appeal procedures, explain the clinical reasoning where that applies, and tell you about your right to go to court to recover benefits^source.

Write down the date on the notice. Every deadline below counts from a date on paper, not from when you first noticed the problem.

Step 2: Ask for the file the insurer used

You are entitled to see what the decision was built on. For an employer health plan, you can ask for copies of the documents, records, and other information relevant to your claim, and the plan must provide them for free^source. Ask for the notes, the clinical criteria, and any reviewer opinion. A denial based on a criterion you can read is much easier to argue with than one you are guessing at.

Keep your own side too. Hold on to the Explanation of Benefits or letter showing what was denied, a copy of the appeal you sent, and anything extra you supplied such as a letter from your doctor^source. If you do not know how to read the Explanation of Benefits, start with how to read an EOB.

Step 3: File the internal appeal (health plans)

An internal appeal is you asking the insurance company to conduct a full and fair review of its own decision^source. You must file it within 180 days, which is 6 months, of receiving notice that your claim was denied^source. The federal rules for employer plans put the same floor on it: you have at least 180 days to file an appeal, and your plan may allow longer^source.

Then the clock is on them. The appeal must be completed within 30 days if it is for a service you have not received yet, and within 60 days if it is for a service you have already received^source. If the care is urgent, the final decision has to come as quickly as your medical condition requires and at least within 4 business days of the request^source. At the end of the process the insurance company must give you a written decision^source.

Write the appeal to the stated reason, not around it. Give specific reasons why the claim qualifies for payment under your policy, be detailed, explain medical necessity, and include evidence such as medical records, lab results, or a letter from your physician^source. Use the wording from your own policy where you can, and keep a copy of everything you send^source.

Step 4: Go to external review

If the internal appeal fails, you have the right to take it to an independent third party. That is called an external review, and it means the insurance company no longer gets the final say over whether to pay a claim^source. The insurer's final internal determination has to tell you how to ask for one^source.

You must file a written request for external review within 4 months after the date you receive the final denial^source. External review covers denials that involve medical judgment where you and the plan disagree, decisions that a treatment is experimental or investigational, and cancellations of coverage based on claims that you gave false information on your application^source.

A standard external review is decided no later than 45 days after the request is received, and an expedited one no later than 72 hours or less depending on the medical urgency^source. The key point: your insurer is required by law to accept the external reviewer's decision^source. For plans that use the federal process, requests go to MAXIMUS Federal Services, and the help line is 1-888-866-6205^source.

If it is urgent, do not wait your turn

You do not always have to finish the internal appeal first. In urgent situations you can request an external review even if you have not completed all of the plan's internal appeals, and you may file an internal appeal and an external review request at the same time^source. If the denial puts you at serious risk, say so in writing and ask for an expedited review^source.

Keep a record of every call

Appeals are won on specifics, and the specifics are usually spoken. An agent tells you the claim is being reprocessed, or that prior authorization was on file, or that someone will call you back in ten days. None of that is in the denial letter. Ask for the agent name and a reference number, note the date and time, and where your state allows it, record the call so you can quote it instead of paraphrasing it. See how to prove what they told you on the phone and call recording laws by state first, because the consent rule depends on where you are.

Home and auto denials work differently

Property and casualty claims are not covered by the federal health-appeal machinery above. There is no 180-day internal appeal and no binding external review. The leverage is your policy and your state regulator.

Start by making the insurer put it in writing: ask the adjuster to provide a written explanation of the decisions he or she makes^source. If the fight is about the value rather than whether the loss is covered, check your policy for an appraisal clause^source, which is a contractual route to an independent valuation. If you disagree with a settlement, try to resolve the differences with your insurer, and consider having your repairer meet with you and the adjuster^source. Take notes and keep track of the dates of any conversations you have with your agent or adjuster^source. Home claims follow the same shape: written denial, the policy language it rests on, your own documentation and photographs.

Then use the regulator. Every U.S. state, the District of Columbia, and the five territories have a department of insurance, and you can file a complaint about unfair claim delays or denials or a failure to honor your policy^source. Regulators forward your complaint to the insurance company, the insurer must respond with its explanation, and the department determines whether the insurer was fair based on your policy; if it finds a problem it can require the company to correct it and comply with state law^source. Gather your policy number, documentation, bills, and records first, and create a record of all communication with your insurer including emails, letters, phone calls, dates, and times^source. Stick to the facts and timelines, use language from your policy where you can, and state the outcome you want^source.