Read the denial against the policy
Request the specific provision relied on, in writing, then read the policy's definitions, exclusions and conditions against it. Insurers are generally expected to explain denials with reference to the policy.
Ambiguity in policy wording is often construed in the policyholder's favour. That principle is why the exact words of an exclusion — and whether your facts actually fall inside it — matter more than the insurer's summary of them.
Conditions you had to meet
Many denials rest not on coverage but on conditions: prompt notice, cooperation with the investigation, mitigating further damage, or producing requested documentation. Check whether the alleged failure actually occurred and whether it caused any prejudice.
Commercial policies commonly require prompt notice of a claim or circumstance, and late notice is a frequent basis for declining defence costs. Notify early, even where liability is unclear.
Good faith, and what it adds
Insurers owe policyholders a duty of good faith in claims handling — reasonable timeliness, fair investigation, and not taking advantage of a vulnerable position. Bad-faith conduct can expose an insurer to liability beyond the claim value itself.
Practically, this means documented delays, shifting reasons, repeated identical document requests and unexplained silence are worth recording carefully. They can matter as much as the coverage argument.
Escalation and deadlines
Use the insurer's internal appeal, then the independent ombudservice for your product type — life and health, or general insurance for home, auto and business. Both cost nothing. Provincial regulators oversee market conduct.
Critically, limitation periods for suing an insurer apply and can be shortened by the policy itself. Check the policy's limitation wording early; do not assume you have years.
Frequently asked questions
- What should I ask for first after a denial?
- The specific policy provision relied on, in writing, plus what evidence was considered. You cannot rebut a reason you have not been given precisely.
- Is challenging a denial free?
- The internal appeal and the independent ombudservices are free. Litigation is not, which is why the free routes should be exhausted first.
- Can the policy shorten my time to sue?
- Yes — policies can contain their own limitation provisions. Check that wording early rather than relying on the general statutory period.
- Does the duty of good faith mean extra compensation?
- It can. Bad-faith claims handling may expose an insurer to liability beyond the claim itself, depending on the jurisdiction and conduct.
This guide is general information, not legal advice. Laws, costs, and procedures vary by state, province, and your specific situation — speak with a qualified insurance law lawyer about your circumstances before acting.