Here’s how to resolve a dispute with your insurance provider

If you are a car owner in the Philippines, there are a few things you must have with you, or else you won’t be able to drive around freely. Wondering, what? Well the list includes -

• Car registration, LTO OR/CR
• Driver’s license
• Car insurance

While we have discussed the above two in detail earlier, our focus is on insurance and that too the dispute part of things. It is not an uncommon problem and can only be tackled with proper know-how. But first, let’s get the basics right.

Also Read: Common mistakes to avoid when renewing your OR/CR in the Philippines

Basics of car insurance in the Philippines

It is a financial contract between the car owner and the insurance provider, shielding the former against major financial loss. The degree of protection varies and is determined by the annual premium paid and coverage included in the policy.

At a minimum, all vehicle owners in the Philippines must get Compulsory Third Party Liability Insurance (CTPL) that covers the death and injury of third parties. Therefore, to protect themselves and their vehicles, most car owners opt for comprehensive coverage. This one compensates the policyholder for financial losses due to the following -

• Physical damage
• Bodily injury resulting from vehicle collision, theft, fire
• Damage that may arise from incidents in a vehicle.

Coming back to the point…

Car insurance disputes

So, you got involved in an accident with damages occurring to both your car and the other car involved in the collision. A general response would be a shock at first, followed by realization and damage assessment, and lastly contacting your insurance agent thinking they’ll assist you in getting financial assistance for all the damage that occurred. While we hope you get all the compensation you deserve, however, it doesn’t happen exactly as we plan. Sometimes you and your insurer aren’t on the same page regarding the benefit you are entitled to.

Common grounds for car insurance disputes/complaints

You can file a complaint against your car insurance provider for several reasons, one of the most common reasons around claim settlement, however, there’s more to it The table below discusses the various reasons you can file a complaint -

Unfair claim settlement practices	If your insurance provider denies a legitimate claim, offers a significantly low settlement compared to the actual loss, or delays payment.
Unfair policy cancellation or non-renewal	If your car insurance provider canceled your policy or was not renewed without a valid reason.
Misrepresentation	If your insurance provider does not disclose essential details or offers misleading information about the policy.
Violation of insurance-related laws and regulations	Any action by the insurance provider that breaches the Insurance Code of the Philippines.

Why does the claim get completely rejected or reduced?

As mentioned, one of the most common disputes between an insurance company and the insuree revolves around claim settlement. Sometimes the insurer completely denies the claim while other times a significantly low claim amount is passed or the payment is delayed. In all of these cases, a complaint can be filed, and action can be taken against the insurance company.

But first let us understand why your claim was rejected, reduced, or delayed. Some of the top reasons include -

• The insurance provider believes the accident is not covered under your policy.
• Information and documents accompanying your claim are incomplete.
• Non-disclosure about previous driving accidents and claims to the insurer.
• Modifications were made to the vehicle that affected its performance and no such information was disclosed to the insurer.
• Negligence on the part of the car owner leading to the incident like leaving doors unlocked, windows open, key in the ignition, intoxication, etc.

Also Read: All you need to know about taking photos after a car accident in the Philippines

How to resolve a car insurance claim?

In case you find yourself in a situation wherein your insurance provider acted unfairly or improperly, you have the right to file a complaint. Yes, you can do so at the Insurance Commission (IC) which is the Philippines’s primary government agency responsible for supervising and regulating insurance companies along with others (including mutual benefit associations, health maintenance organizations, and pre-need companies). Continue reading as we’ll be discussing a step-by-step guide to file a complaint with the IC.

But before heading to the IC, we’d suggest you go to your insurance provider and request a review. Every insurance company in the Philippines has an in-house dispute resolution system that takes care of such matters. These in-house dispute-resolving departments are also active members of third-party resolution schemes and together they work towards preventing disputes from escalating.

Did you know? In 2023, the Insurance Commission resolved all 5,417 complaints filed by insurance policyholders.

However, if you are not satisfied with the decision after being reviewed by the in-house and external systems, you have the option to take legal action. Speaking of which there are two legal discourses you can take to resolve the dispute - Mediation and Arbitration; let us discuss each one by one.

Mediation

It is a pre-legal process wherein you or your insurance claim lawyer sit with the insurance provider to discuss the matter in the presence of a neutral mediator. By the end of the process, the mediator has a file prepared with all the issues - both resolved and unresolved, along with the necessary steps to be taken.

Key features of the mediation process -

• Mediation can be conducted in person, over a call, or via video conferencing.
• The entire process usually takes 60 days but may take a little longer until both parties agree in writing.
• Either you or your insurance lawyer needs to be present during the mediation process.

Arbitration

When the mediation process fails to resolve the dispute between the insurance company and the insured, Arbitration is the next best attempt at resolution. Here, you or your representative will first discuss the case with the arbitrator; this meeting is called a pre-hearing conference. The arbitrator will try its best to settle the case; however, if an agreement proves elusive, a hearing date will be scheduled. Note that the arbitrator's decision is binding on both you and the insurance provider.

Key features of the arbitration process -

• To be eligible for the arbitration process, the application must come from the insuree and not the insurance company.
• The application must reach the arbitrator within two years from the start of the dispute or 90 days after the mediator filed a report, whichever is later.

Step-by-step guide to filing a complaint with the Insurance Commission

Step 1. Gather all relevant documents before heading out to file a complaint. The list includes your insurance policy, records of all communication you had with the insurance provider, and all other evidence supporting your claim.

Step 2. The next step would be to file a complaint with your insurance provider before heading to the IC. You can do so by writing a formal letter wherein you shall detail your concern and the resolution you intend to seek. Remember to give the insurance provider a reasonable amount of time to revert.

Step 3. No luck with your insurance provider, it’s time to file a formal complaint with the Insurance Commission (IC). This can be done by submitting a written complaint along with supporting documents. It can be done in either of the two ways -

• In-person or e-mail - Head to the IC office with the complaint letter and other required documents.
• Online - IC allows you to file a complaint from the comfort of your home either by sending the letter and essential documents to IC’s official email address or its official website.

Step 4. Your part is done and now it's IC’s turn to turn around some tables by investigating the matter. The officials can ask for additional information, if needed, or can even conduct hearings.

Step 5. Post its investigation, IC will issue an order instructing the insurance provider to take corrective measures like paying the claim or refunding premiums.

Tips to remember when filling a complaint with the IC

• Act promptly when filing a complaint with the IC, delays can negatively impact the outcome.
• Check the timeframes prescribed by the Insurance Code.
• Though seeking legal assistance is not mandatory, having a lawyer by your side can help you navigate the process better.

Car insurance violation & Department of Trade and Industry (DTI)

In case, the insuree feels that his/her insurance provider is violating any law they can file a formal complaint with the local Department of Trade and Industry (DTI). The agency is committed to providing timely, fair, and professional responses.

Key features of DTI -

• Alternative Dispute Resolution technique is practiced by DTI.
• If the case is under DTI’s jurisdiction, the complainant needs to undergo a mediation process first, followed by arbitration (if the former doesn’t work).
• DTI’s decision is legally binding on both parties - the insuree and insurer.
• If the dispute or violation is beyond the scope of DTI, the case would be quickly transferred to the appropriate agency. Further, DTI also monitors the case progress and makes sure it is resolved at the earliest.

Bottom line

When it comes to resolving disputes with an insurance provider, many think it is a daunting task. However, with the correct approach and the right knowledge of the process, it becomes quite easy to advocate your rights. No matter the issue from claim denial, policy dispute, or unfair settlement - it is to one's advantage to know the legal options. The latter includes mediation and arbitration processes along with filing a formal complaint with the Insurance Commission.

Also Read: All you need to know about ‘Loss of Use’ car insurance coverage