Insurance claims are a very important aspect of the insurance market, and something that has to be clearly understood by policy holders and insured parties, in order to avoid any misunderstanding. Insurance claims are in fact requests made by policy holders to the insurer (in general, the insurance company) asking them to pay for a loss. Insurance claims must be filed by policy holders before any money is disbursed to a hospital (in case of health insurance claims), repair shop (in case of car insurance claims).

In general, when a person files an insurance claim, the insurance company sends an investigator to evaluate the authenticity of the claim, and to determine if prices of the service requested (whether medical or repairing costs) are reasonable, to prevent any sort of fraud. In the USA alone, it is estimated a loss of $80 billion annually, only due to insurance frauds. That’s why the work of the insurance adjustor or appraiser it’s essential to guarantee an efficient work. Insurance claims are not compulsory in the event of any accident or medical help needed. The insured may opt for not to file an insurance claim if costs are minor of if a third party decided to pay out-of-pocket, a situation very common in case of car accidents.

It is important to stress out that an insurance claim is not a guarantee of pay-out. First, the insurance company has to assess the situation and evaluate if it’s reasonable to be paid. Some insurance claims may be not recognized by the insurance company, for several different reasons. The most common reason is that when the damage is caused by negligence or carelessness, and also when it’s caused by what is called Act of God, a flood, hurricane or earthquake for instance. As such situations are in general unavoidable, most insurance companies have the right to refuse payments.