Insurance Claims Attorney: Claim Denial, Appeal and Court Action
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Have you received a denial letter from your insurance company? This is the stage where your next decision makes all the difference. Lev-Taieb Law Firm examines the denial letter, the policy and the circumstances of the incident, and decides together with you on the right course of action: a reasoned appeal to the insurance company, an appeal to the Commissioner of Markets, Insurance and Savings, direct negotiation, or a lawsuit. We work on a success fee basis in most cases, without advance fees in tort cases, and with complete transparency throughout the process.
Behind every denial letter usually stands an entire team at the insurance company: company doctors, investigators, legal advisors, and claims adjusters. The insured, facing this alone, is in an inherently disadvantaged position. An attorney specializing in insurance claims levels the playing field, using the same tools the insurance company employs: professional policy analysis, independent medical opinions, and reasoned appeals containing relevant legal provisions and supporting case law.
What is insurance claim denial and what is its legal significance
Insurance claim denial is a formal notice from the insurance company, stating that it refuses to pay benefits or compensation for an insurance incident that occurred. The denial can be complete, where the insurer claims there is no insurance coverage at all, or partial, where the insurer agrees to pay part of the amount and refuses the other part. The practical meaning is almost identical in both cases: the insured faces an insurance company that is a professional party, experienced and with extensive legal resources, and must choose between accepting the decision or fighting.
The Insurance Contract Law, 5741-1981, regulates the relationship between the insured and insurer and places substantial obligations on the insurance company. The company must in every case of denial provide written justification for its decision, refer the insured to relevant policy sections, and state the precise grounds. Commissioner of Insurance Circular 2013-1-12 (Fair Disclosure) explicitly states what the insurance company must include in the denial letter: the grounds, reference to the policy section or exclusion, and the right to appeal. A denial letter that is not properly reasoned is legally weak, and sometimes the deficiency alone is enough to obligate the insurance company to reconsider.
Important to understand: silence from the insured after receiving a denial letter is not considered a waiver of rights. But the longer time passes, the greater the risk of loss of evidence, loss of documents, statute of limitations, and difficulty in reconstructing the facts. Therefore, receiving a denial letter should lead to organized action within a short time frame, even if not rushed.
Common grounds for denial and how to challenge each one
Insurance companies repeat themselves in denial grounds. Those who have handled many denial cases learn to recognize the patterns. Here are the most common grounds and how to challenge them:
1. Material non-disclosure in the application questionnaire
This is the most common ground. The insurance company claims that the insured did not mention an illness, medical condition or certain habit in the application questionnaire, and therefore the policy is void or the exclusion applies. The defense: Section 6 of the Insurance Contract Law distinguishes between a detailed question and a general question. If the question was not specific, there is no duty to disclose. Additionally, the duty of disclosure only applies to what the insured actually knew, not to an undiagnosed condition.
2. Application of policy exclusion
The insurance company claims that the incident falls under a policy exclusion. The defense: According to case law, exclusions are read with restrictive interpretation in favor of the insured. Any doubt is in favor of the insured. The section must be read carefully, compared to standard policy language, and sometimes it must be proven that the exclusion language is ambiguous.
3. Pre-existing condition
The insurance company claims that the medical condition existed before the insurance began. The defense: It’s important to distinguish between a known illness and an undiagnosed condition. A person who did not know about their medical condition did not conceal it, even if it later turns out the illness existed. Organized medical information is required, sometimes also an independent medical opinion.
4. Fraud allegation
The insurance company claims the insured committed fraud. The defense: The burden of proof is on the insurance company, with a high standard of proof. Mere suspicion is not enough. Actual evidence is required. Sometimes this is an opportunity to turn the claim in favor of the insured: false denial based on fictitious fraud can win additional compensation.
5. Alcohol, drugs or illegal driving exclusion
Insurance companies try to apply exclusions even when the connection between consumption and damage is weak. The defense: It must be examined whether consumption was the cause of the incident, and whether the test result is actually based on real data. Even if the insured drank, if the consumption did not cause the accident, the exclusion does not apply.
6. Delay in notifying about the incident
The policy requires immediate notification. The defense: Section 23 of the Insurance Contract Law clarifies that delay alone does not cancel the payment obligation, unless the delay caused evidentiary damage to the insurance company. If the delay was reasonable and did not harm the investigation ability, the right to compensation is preserved.
7. Non-payment of premium on time or insurance cancellation
The insurance company claims the policy was cancelled due to payment delay, and therefore at the time of the incident there was no coverage. The defense: The Insurance Contract Law requires the insurer to send written notice and provide a notice period before insurance cancellation. The insurance company must prove that the notice was actually sent and received. In many cases, the delay resulted from a bank error or non-receipt of billing, not from actual breach of payment obligation.
8. Claim that the incident is not an “accident” or not an “insurance case”
The insurance company claims the incident does not fall under the definition of “insurance case” in the policy. The defense: Policy definitions are read with reasonable interpretation, sometimes even broader than what the insurance company claims. Common example: insurance covering “accident” but trying to exclude internal mechanical incidents in the body. Israeli case law is rich with cases where the court broadened the definition of “accident” in favor of the insured, when the reasonable meaning of the term included the incident.
Types of policies and insurance: what each covers and when it’s denied
Understanding the type of policy is the first condition for understanding the denial. Each type of policy has its own contract language, typical exclusions, and recurring areas of dispute.
Home and building insurance
A home policy covers the building, contents, or both. Common reasons for denial in home insurance: claim that “there was no forced break-in” (unclear break-in signs), claim that damage was caused by natural wear and not an insurance incident, and claim that “there was no minimum supervision” when the home was empty. Israeli case law has established a series of precedents on interpretation of “break-in” and “supervision” exclusions.
Comprehensive and mandatory car insurance
Mandatory car insurance is compulsory legal insurance covering bodily injury to driver, passengers and pedestrians. Comprehensive insurance covers the vehicle itself and third party property. Common reasons for car claim denial: claim of driving under the influence of alcohol, claim that the driver was unauthorized (invalid license, driving without vehicle owner’s permission), and application of “special risk” exclusions. In mandatory insurance, the Motor Vehicle Accident Victims Compensation Law, 5735-1975, creates absolute liability on the insurer, significantly limiting justifications for denial.
Life insurance
A life insurance policy pays beneficiaries an amount in case of the insured’s death. Common reasons for denial: claim of non-disclosure of pre-existing illness in application questionnaire, claim that death was caused by an uncovered reason (suicide in first waiting period, unreported dangerous activity), and claim that beneficiaries are not those entitled. Litigation in this field requires personal sensitivity in addition to legal capabilities, because beneficiaries are usually in a state of grief and stress.
Private health insurance
Private health policies cover treatments outside the public health basket, treatment upgrades, and access to private doctors. Common reasons for denial: claim that treatment is “experimental”, claim that condition existed before the policy, and claim that treatment is not “medically necessary”. Battles in this field require combining independent medical opinion with contractual interpretation of the policy. Delay in approving urgent treatment can cause irreversible medical damage, so there are cases that justify urgent court application for a mandatory order.
Loss of work capacity insurance
Loss of work capacity policy pays monthly benefits to the insured who is no longer able to work following illness or accident. Common reasons for denial: claim that the insured is still capable of working in “another reasonable occupation”, “pre-existing condition” claim, and claim that the loss is partial and not complete. The definition of “work capacity” varies from policy to policy: there are policies that pay if the insured cannot work in his specific occupation, and others that require inability to work in any occupation. This difference is the root of many disputes.
Professional liability, business and travel abroad insurance
Professional liability policies protect professionals (doctors, lawyers, accountants, architects) from client lawsuits. Travel policies cover medical expenses, lost luggage and trip cancellation. In all of these, the importance of the initial risk declaration is enormous, and Insurance Circular 2013-1-12 applies to them as well. Even small changes in occupation or nature of travel can affect coverage.
The appeal process: from denial letter to court lawsuit
Appeal against denial is a structured process. The more professionally it is conducted, the higher the reasonable compensation amount and the shorter the time until payment. Before starting, it’s important to avoid mistakes that harm the case.
Common mistakes insured people make after receiving a denial letter
Experience teaches that many insured people harm themselves unknowingly. Immediate telephone response when an insurance company representative calls to “explain the decision”, recorded calls that can be used against you. Signing documents such as “confirmation of receipt of denial letter” or “waiver of additional claims” as a condition for partial payment, signing that may close the right to continue. Waiving copies of medical file or application questionnaire, which the insurance company must provide upon request. Seeking an attorney only on the eve of filing suit, when only a few weeks remain before the statute of limitations period. Not checking if there is supplementary coverage from another policy, because sometimes the same incident is covered by more than one policy. Careful and professional response to every approach: “I want to check the material with an attorney and will get back to you in writing”.
Stage 1: Examining the denial letter and policy
The first reading of the denial letter should be with professional eyes. What exactly is the ground? Which policy sections does it refer to? Are the sections actually relevant? Is the letter reasoned as required by Insurance Circular 2013-1-12? At this stage, it’s possible to identify if there is a formal defect that justifies returning the discussion to the insurance company before any substantial action.
Stage 2: Building the appeal case
A winning appeal case consists of layers: the denial letter itself, the complete policy, application questionnaire, incident documents (medical file, appraiser opinions, police reports), independent professional opinion, and sometimes also insured and witness affidavits. Each document is examined, organized and included in the final package. The package is accompanied by a reasoned arguments letter, detailing all legal sections and case law supporting the insured’s position.
Stage 3: Appeal to the Commissioner of Markets, Insurance and Savings
The Commissioner of Markets, Insurance and Savings (formerly Insurance Commissioner) is an independent regulator authorized to examine complaints against insurance companies. Appeal to him does not replace legal proceedings, but it creates regulatory pressure on the insurance company, documents the complaint, and sometimes leads to reopening the case. The appeal is appropriate in cases where it appears the insurance company did not fulfill its regulatory obligations.
Stage 4: Mediation, arbitration or court lawsuit
When there is basis for a case and the insurance company does not agree to settlement in direct negotiation, mediation can be approached. Mediation is a fast, flexible, and non-binding process. Arbitration, on the other hand, binds the parties to the arbitrator’s decision. If no arrangement is reached, a lawsuit is filed. Choice of forum depends on the amount: Small Claims Court up to 35,000 shekels, Magistrates Court up to 2.5 million shekels, and District Court above that amount. The court gives a binding judgment, allows appeal, and creates precedent that also binds the insurance company in other cases. In certain cases, it’s worthwhile to sue even if winning chances are moderate, just to enable serious negotiation. Filing the lawsuit itself changes the balance: the insurance company moves from a position of “decision maker” to a position of “defender”.
Documents to collect before the first meeting
Core documents: Complete denial letter with appendices, complete policy (general terms, special terms, policy schedule, appendices), application questionnaire in every version available, premium payment proofs (bank statements, authorization confirmations, invoices), and previous correspondence with the insurance company about the incident.
Incident documents: Vary by insurance type. Health insurance requires complete medical file, hospitalization summaries, tests, treating physician opinions. Property insurance requires appraiser opinion, damage photographs and police reports if relevant. Life insurance requires death certificate, final hospitalization papers, and sometimes case investigation report. Loss of work capacity insurance requires documents documenting reduced functioning and occupational physician opinion.
Important to know: The statute of limitations period for insurance claims under the Insurance Contract Law is, as a rule, three years from the occurrence of the insurance incident. But there are exceptions that can extend the period, for example in loss of work capacity claims. The statute of limitations calculation must be done carefully, because an error can completely close a case.
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Practical examples from cases we handled
A typical case that went through our office: A 52-year-old insured, construction worker, chronic back injury following work accident. He filed a loss of work capacity claim with the insurance company. The company denied the claim claiming that a “pre-existing condition” of the back was not reported in the application questionnaire, and therefore material non-disclosure provision applies according to Section 6 of the Insurance Contract Law. Analysis of the denial letter showed that the application questionnaire did not specifically refer to back pain, but to a general question about “pre-existing illnesses”. Chronic back pain is not necessarily an “illness” in the technical sense, and an unspecifically diagnosed condition does not constitute “material non-disclosure”. Additionally, an independent medical opinion showed that the final incident leading to loss of work capacity did not stem from a pre-existing condition, but from an acute incident that happened at work. Within four months of the demand letter, the insurance company reversed the denial and reached a settlement that paid the insured the full loss of work capacity benefits for the expected period, plus compensation for payment delay. No legal proceeding was required.
The lesson: Professional analysis of the denial letter, support with appropriate medical opinion, and organized legal argument, can open a case that seemed lost. This type of case is daily reality in the field.
Second case: Home insurance denial claiming “lack of supervision”
Another case, typical of home insurance: A family traveled abroad for a week, left the apartment empty. While abroad, the apartment was burglarized and jewelry and valuable items were stolen. The insurance company denied the claim claiming that “minimum supervision was not exercised” as required by the policy. Analysis revealed that the policy did not precisely define what is “minimum supervision”, and Israeli case law established that any doubt is read in favor of the insured. Additionally, it turned out the family asked a neighbor to check the apartment every few days, and this action was proven by testimony. Within three months of the demand letter, the insurance company approved the claim in full, including compensation for treatment delay.
Laws and regulations that protect you
The insured’s rights are anchored in several laws and regulations. Knowledge of the legal framework helps understand the depth of protection and the tools available to those entitled.
Insurance Contract Law, 5741-1981
The main law. Regulates the relationship between insured and insurer. Key sections: Section 6 (duty of disclosure), Section 22 (duty of timely payment), Section 23 (consequences of delay in notification), Section 27 (statute of limitations), Section 28 (material non-disclosure). The law also regulates rights to compensation for payment delay not in good faith according to Section 28a.
Insurance Ordinance (New Version), 5741-1981
The ordinance regulates state supervision of the insurance market. It establishes the regulatory obligations of insurance companies, the powers of the Commissioner of Markets, Insurance and Savings, and consumer protections for the insured.
Insurance Circular 2013-1-12 (Fair Disclosure in Denial Letter)
Binding regulatory circular. Establishes what the insurance company must include in a denial letter: reasoned ground, reference to policy sections, detail of rights, and right of appeal. Violation of the circular is basis for demanding reopening of the case.
Statute of Limitations Law, 5718-1958
Establishes the time framework for filing suit. In insurance claims: generally three years, with exceptions. Precise calculation of the statute of limitations period is critical, because delay in filing suit can completely block the right.
Legal fees, timeframes and why choose Lev-Taieb
In insurance and tort cases, the common fee model is success-based payment: the insured pays no advance legal fees, but rather an agreed percentage of the compensation amount achieved, only in case of winning. In exceptional cases where the case is particularly complex or risk is high, another arrangement may apply, but in any case transparency is complete before starting work. Even when there are no advance legal fees, there are certain case expenses: court fee (if lawsuit is filed), medical or appraisal opinion, legal proceeding expenses. Part of these expenses can be deducted from the final compensation, and part are imposed on the insurance company if ruled in favor of the insured.
Time is a variable, not fixed. Simple cases ending in settlement based on a reasoned demand letter, close within three to six months. Cases reaching court last on average one to three years, depending on the specific court’s caseload, case complexity, and factual questions requiring proof.
- Thousands of successful cases and insurance claims cases
- 19 years of experience representing insured parties, not insurance companies
- Deep policy reading: Analysis of exclusions, special terms and small details that insurance companies expect you not to read
- Professional opinions: Network of doctors, appraisers, accountants and other experts who have worked with the firm for years
- Flexible payment terms in tort cases, without advance commitment
- Initial consultation without commitment, without obligations
Frequently asked questions about insurance claims and denials
What to do immediately after receiving a denial letter?
Keep the complete letter, collect the policy and all application documents, and do not respond to the insurance company before organized examination. It’s recommended to contact an attorney within two weeks of receiving the letter. Hasty response, even by phone, can harm the case.
How much time is there to file an appeal?
Depends on insurance type and circumstances. In property insurance claims usually one year from denial date. In loss of work capacity insurance up to three years, and up to seven years in special circumstances. It’s important to approach early, both to avoid losing evidence and so the statute of limitations period doesn’t approach.
Can the insurance company deny because of an illness I didn’t know about?
No. The duty of disclosure according to Section 6 of the Insurance Contract Law applies to what the insured actually knew. An undiagnosed illness does not constitute concealment. However, if you had a symptom that should have led to examination and you didn’t check, the insurance company may claim this is “conscious disregard”. It’s important to document what you knew and from when.
What exactly is “material non-disclosure”?
Information that a reasonable person would have disclosed in the application questionnaire, and that would have affected the insurance company’s decision to insure, on policy terms or on premium amount. Not every old illness is “material”. A minor illness that didn’t require treatment won’t be considered material. The court examines materiality objectively, not only according to the insurance company’s claim.
Is it worth suing for small amounts?
Yes. Small Claims Court allows lawsuits up to 35,000 shekels without an attorney. Above that amount, attorney cost is usually included in expected compensation. Even in cases of a few thousand shekels, there are cases where quick settlement is reached before legal proceedings, just based on a professional demand letter.
What’s the difference between private insurance and group insurance?
In private insurance, the insured owns the policy. In group insurance (usually through workplace or professional organization), the employer or organization owns the policy, and employees are insured under it. Coverage terms in group insurance depend on the group agreement. Sometimes coverage is more limited, sometimes broader.
Can punitive damages also be claimed?
Yes. Section 28a of the Insurance Contract Law allows claiming special damages if the insurance company denied the claim not in good faith, or delayed payment without justification. Israeli case law has developed this cause of action over the years, and in appropriate cases it’s possible to win additional amounts beyond the insurance amount itself.
What to do if the insurance company requires a repeat medical examination?
In many cases the insurance company requires the insured to undergo a medical examination on its behalf, with a doctor it chooses. This is a certain right of the insurance company, but it’s not absolute. Must examine: whether the examination is written in the policy as a condition, who chooses the doctor, whether the insured may be accompanied by another person, and what questions will be presented to the doctor. When necessary, it’s possible to demand that the examination be conducted by an objective doctor.
What’s the difference between appeal and lawsuit?
Appeal is a voluntary procedure within the insurance company system: asking the company to reconsider the decision in light of new arguments and evidence. Lawsuit is a formal legal proceeding in court: the court is authorized to obligate the insurance company to pay, impose expenses on it, and award compensation for suffering. In practice, most cases start with appeal and negotiation, and only part reach lawsuit.
Can the insurance company demand I return payment I already received?
In certain circumstances yes, and in certain conditions no. If the insurance company paid benefits and later discovered material non-disclosure, it may demand return. But there are limitations: if over three years passed, if the insured changed his situation based on the payment, if the insurance company knew about the facts before payment, return ability is limited. Every return demand requires organized legal examination before any agreement.
Ready to send the denial letter?
Send the denial letter and policy via WhatsApp. Initial examination without commitment. If there’s basis for a claim, you’ll know immediately and clearly. If not, that will also be said honestly, without wasting your time or resources. If your denial relates to a specific field, it may be worth reading also: Long-term care insurance, National Insurance and medical committees, or Medical malpractice.
