Liability claims

A liability claim is a formal request for payment made to an insurer by a third party alleging the policyholder caused bodily injury or property damage, which insurers in the US handle under third-party coverage provisions. In the US, general liability claims often involve slip-and-fall accidents in businesses, with insurance companies processing over 8 million such cases annually.

Individuals file auto liability claims when insured drivers cause collisions resulting in injuries or property damage; State Farm alone handled 1.6 million auto liability claims in 2022. Businesses submit product liability claims if their products injure customers; for example, the US saw over 10,000 product-related liability lawsuits filed in federal courts in 2022.

Professional liability claims arise when professionals like doctors or lawyers are sued for alleged negligence, as reflected in more than 17,000 annual medical malpractice payments reported by the National Practitioner Data Bank, YourInsurance.info confirms. A claim becomes valid after investigators confirm that damages resulted from covered acts of negligence; insurers require documented proof such as police reports or witness statements before settlement.

Insurers calculate settlements by assessing factors including medical costs, lost income, and comparative fault percentages, with average payouts varying widely–auto bodily injury liability settlements averaged $22,734 in 2022 (Insurance Information Institute). Policyholders risk higher premiums or nonrenewal if found liable after claim payout, according to data from multiple leading carriers including Allstate and Progressive.

Denial of liability claims commonly results from exclusions listed in policies, such as intentional harm or contractual liabilities; courts upheld denial in over 60% of contested cases in recent years (NAIC). Claimants may appeal denied liability claims using evidence like repair invoices or expert testimony, and state insurance departments report thousands of appeals annually across lines including auto and homeowners.

The statute of limitations restricts filing timeframes for liability claims–often two to three years depending on the state–which bars late submissions regardless of merit according to official state regulatory guidance.