Mediating a Car Insurance Claim Dispute
If you don’t want to spend a day in court with your insurance company, you could try to mediate your claim or take it up with an independent arbitrator.
The major difference between the two is that mediation is merely a suggestion and doesn’t have to be taken seriously where as arbitration is legally binding. Also, arbitration is more costly than mediation.
Before you consider either route, you should try to work things out between you and your insurance company. Send them a letter and cite and include any documents that you may need to support your argument. Make sure you keep your tone civil and polite so the car insurance company remains more likely to negotiate.
Should you not find any satisfaction with this route, it may be time to pursue mediation. Mediation is a good start towards a sensible resolution and is affordable for both sides. The mediator will work with both sides and try to arrive at an agreeable compromise. To start mediation, you will have to complete a Demand of Arbitration, which will give you a choice between mediation and arbitration. Remember that the mediator can only make suggestions and they are not legally binding.
If mediation doesn’t work, the next step is arbitration. Arbitration works similar to mediation in that both parties must agree to it but unlike mediation, arbitration is legally binding. It is usually a good idea to have an attorney present during arbitration and you should inform your insurance company of your intent to do so.
Arbitration is very similar to a court hearing. Both sides will be required to present their case and call witnesses. An arbitrator has significant power being able to subpoena documents and witnesses, gather evidence in a case, and even create or extend a deadline in necessary. They can certainly establish that you entitled to certain monies but it won’t be more than the policy allows. If you come to an agreement with your insurance company before the deadline, you can submit that in lieu of a final ruling from the arbitrator.
Once the arbitrator reaches an acceptable decision, it will be final with no further recourse so make sure you have your case prepared before your case is heard. Keep in mind that arbitrations are a powerful tool just slightly removed from a court case. The key difference is that your expenses while sizable will be significantly less than if you were to actually go to trial, which can be formidably expensive. Hiring a lawyer will increase the cost of arbitration, but it will still be far less than if it has to go to court.