How do insurance companies avoid paying claims?

Hi anon,

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The short answer is, they don't.

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They only avoid paying fradulent claims.

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There are many checks and balances in place which I don't think are public information as to how insurers determine if a claim is genuine or not.

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Industry statistics shows that a small percentage of claims are denied due to various reasons. Most of the time, either the supporting evidence was not complete, or it was indeed fraud. For the first scenario, providing more evidence would solve the problem.

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Recently I had a claim for my client denied, but it was due to some missing evidence. We provided it and the claim was paid without fuss.

Misconception here. Insurance companies do not avoid paying claims. It is the insured's responsibility to understand what coverage they are buying and under what terms, conditions and exclusions. Insurance companies are not charity. its just a probability business.