The length of time that insurance companies take to settle a claim will vary and be dependent upon a number of factors. These will include the type of insurance that you are making a claim against, for instance, whether it is a motor, property, travel, health or life policy claim that is being made. Similarly, insurance companies may act differently depending upon their location. For the purpose of this explanation however, it is intended to concentrate upon the UK market response although, in the opinion of the author this differs little from the response in the US and other democratic areas of the world.
There are generally two forms of motor insurance in the UK this being third party or third party, fire and theft and comprehensive. The former only covers damage done to other persons, property and vehicles and the latter applies to the policyholder and their vehicle as well. In general, within a few days of making the claim and once the damage has been assessed and an estimate of repair or cost provided, the claim will be authorised. Once that has been achieved, the claim will normally be settled within a month to six weeks. This applies as long as the driver has conformed to all the conditions of the motor policy.
Small property and household claims, such as damage to furniture, fencing etc, will usually be settled within a relatively short space of time. Normally one could expect to see a payout within a two-month period in these cases.
However, where the claim being made is more substantial in nature, for example in cases where there might have been flood or fire damage, the processing of a claim will take longer. The reason for this is that the insurance company will require a qualified assessor to evaluate the damage that has been caused and also the potential cost of repairs and replacement.
The settlement of travel insurance claims is more difficult to be precise about because it will vary in relation to the purpose of the claim. If one is claiming for lost or stolen money during the actual vacation or journey then, providing one can produce a local police incident report and number it is likely that there will be an immediate replacement of funds arranged. Other travel claims, which might consist of stolen or lost property and clothing are usually dealt with after the return from the trip and, in these cases, are likely to be settled within a month to six week as long as the insurance company can be satisfied that the claim is genuine.
Health Insurance and Life policies
Of all the insurance policies that can be claimed against, health and life insurance is the most complex. With health insurance, apart from simple cases relating to dental or eye treatment, some time is usually spent by the insurance company checking the need for the claim with the medical authorities and your doctor. They will also want to be assured that the condition being dealt with was either accurately reported to them prior to the insurance policy being granted or, in the case of a accident or illness that occurs during the life of the policy, that it is as debilitating as suggested and therefore warrants the claim being made. With life insurance, which can only be claim by a surviving relative or other connected person, this will not be settled until probate has been granted and the relevant death certificate and other documentation has been supplied to the insurance company. Therefore it is difficult to gauge how long a settlement would take as it is outside of the control of the insurance company.
All of the above timescales are general guides and there are issues that can affect the settlement timescale. The financial size of the claim would be one such factor that might cause the insurance company to take more care over investigating the circumstances surrounding the incident that led to the claim being made. Similarly, if the claim has been lodged within a short period from the date that the original policy was taken out this might also cause the insurance assessors to examine the process in more detail. Furthermore, if there are two parties involved in the claim, as will often be the case with motor insurance, a dispute between these parties might delay settlement.
It is important when dealing with insurance companies during the claims procedure that you provide accurate, honest and timely responses to any queries that they raise as this will help in the avoidance of settlement delays.