How Insurance Claims Work

Once an incident is reported, the insurer opens a claim file and assigns a claim number. The insured person (or in some cases the injured third party) gets a call from an adjuster. The first call is usually information-gathering: what happened, who was involved, what injuries are reported. The adjuster may ask for a recorded statement. The injured person is generally not required to give one to the other driver's insurer, and often shouldn't before understanding the full scope of their injuries.

The adjuster works for the insurance company. Their job is to investigate the claim, evaluate liability, and resolve the file for as little as the facts reasonably allow. They are not neutral. This doesn't mean they're dishonest — most are professional — but their interests and the injured person's interests are not aligned.

If there's a question about whether the policy even covers the incident, the insurer may send a 'reservation of rights' letter. That means they're investigating but not yet committing to coverage. A denial can happen for many reasons — coverage, policy conditions, timeliness, or a dispute about the facts. A denial isn't the end of the claim, but it changes what comes next.

Every policy has a limit. For bodily injury liability, that's the maximum the insurer will pay per person and per accident. If the claim is worth more than the policy limits, the injured person may have to pursue either the at-fault party's personal assets (rarely productive for most individuals) or other coverage — often their own underinsured motorist coverage in an auto case. Knowing the policy limits early helps set realistic expectations.

Insurers operate on their own timeline. Expect weeks to months between phases. State law sets some minimum response deadlines, and persistent follow-up matters. Complete documentation at the demand stage shortens the process significantly; sparse documentation invites requests for more, and those requests stretch the timeline.