Dealing with Insurance Companies After an Injury in California

Dealing with Insurance Companies After an Injury in California

• October 15, 2025
• Categories: Personal Injury

There are several things to know about dealing with insurance companies after an injury in California.  A few things are obvious, but many are hidden and unexpected.  Making the right choices – and avoiding the pitfalls – can make the difference between a swift and significant payout or a delayed, difficult, or inadequate settlement.

Here are some tips to keep in mind after you’ve been injured in an accident in California. Hiring a skilled personal injury lawyer can also ensure that your legal rights are protected and you’re not bullied by insurance company representatives.

Common Tactics Insurance Companies Use to Minimize Payouts

Insurance companies employ several sophisticated tactics to minimize claim payouts. Here are the key strategies they use:

Settlement Manipulation

Insurance companies often make quick lowball offers immediately after an incident, hoping to capitalize on someone’s immediate financial needs before an injured person fully understands their claim’s value.

Delay Tactics

Insurance companies sometimes deliberately prolong a claim by:

• Repeatedly requesting documentation
• “Losing” submitted paperwork
• Taking unusually long to respond to calls or emails
• Ignoring your messages and inquiries
• Failing to provide regular claim status updates
• Frequently changing your claims adjuster
• Unexpectedly assigning new representatives to your case
• Taking longer than the standard 30-60 days to process your claim
• Scheduling multiple unnecessary inspections
• Requesting extensions without clear justification
• Exceeding state-mandated deadlines for claim decisions
• Taking months to process straightforward claims
• Failing to provide clear explanations for delays
• Denying a claim that they know should be approved, forcing a person to resubmit another claim.

Research shows that these delays can reduce settlements by 20%-30% because an injured person becomes desperate for resolution.

Liability Challenges

Insurance companies frequently attempt to shift blame or dispute liability.  They may argue that the injured person shares responsibility for the incident to decrease compensation.

Medical Claim Challenges

Insurance companies frequently challenge medical diagnoses, lab test results, severity of injuries, and future medical expenses.

Surveillance Tactics

Insurance companies can conduct surveillance of an injured person to find evidence contradicting reported injuries. This includes:

• Physical surveillance
• Social media monitoring
• Activity tracking.

Documentation Strategy

Insurance companies will employ information-gathering techniques to undermine or create doubt about your legal claim. These tactics include:

• Requesting recorded statements that can be used against claimants
• Using medical authorizations to access unrelated history
• Repeatedly asking for the same documentation
• Requesting unnecessary or irrelevant information.

Automated Denials

Insurance companies increasingly use AI and machine-learning algorithms to systematically review and deny claims, shifting the burden to lawyers, physicians, and accident victims to appeal and provide additional documentation.

Financial Pressure

Insurance companies exploit an injured person’s financial vulnerability by:

• Delaying processing until desperation sets in
• Creating hurdles and burdens that overwhelm a legally inexperienced injury victim
• Making the process exhausting enough that some people give up entirely.

Unreasonably Low Initial Offers

Insurance companies can frustrate, confuse, and dishearten injured people by being unreasonable with their first offers. They do this by:

• Prolonging the process to force acceptance of lower settlements
• Delaying payments to earn interest on unpaid claims.

These tactics can result in settlements that are dramatically less than a claim is actually worth. Unless a victim is represented by a savvy lawyer, they may have no way of knowing the true value of their claim.

Legal Deadlines for Insurance Companies to Process Claims in California

In California, insurance companies must follow strict legal deadlines when processing claims. Here are the key time frames:

Initial Response Period

15-Day Acknowledgment – Insurance companies must acknowledge receipt of your claim, provide necessary forms with instructions, and begin investigation within 15 calendar days of receiving the claim.

Decision Timeline

40-Day Decision Window – Insurers must accept or deny a claim within 40 days of receiving the initial notice. If they need an extension, they must provide written reasons within this period.

Payment Requirements

30-Day Payment Window – After accepting a claim or reaching a settlement agreement, insurance companies must pay within 30 calendar days.

Total Processing Time

Maximum Processing Period – The total maximum time for processing and final payment is 85 days.

Communication Requirements

15-Day Response – An insurance company must respond to all lawyer’s/injured party’s communications within 15 days.

30-Day Ongoing Updates – An insurance company must provide claim status updates every 30 days while the claim remains open.

Penalties for Delays

If insurance companies fail to meet these deadlines, they may face:

• Interest charges beginning on the 31st day
• Payment of all collection costs
• Reasonable attorney fees if legal action becomes necessary.

How Insurance Companies Use Vague and Undefined Policy Language to Their Advantage

Insurance companies strategically use policy language as a powerful tool to minimize payouts and deny claims. Here’s how they employ language to their advantage:

Ambiguous Language Tactics

Deliberate Vagueness – Insurance companies often write policies with intentionally vague or complex language that can be interpreted in multiple ways.  They exploit this complexity to misinterpret policy terms in their favor, particularly when denying coverage for treatments or claims.

Undefined Terms – By leaving certain terms undefined while defining others, insurers create opportunities to interpret the policy language in ways that favor claim denials.  This selective definition strategy creates inherent ambiguities that can be exploited during claims processing.

Exclusion Manipulation

Insurers increasingly use “absolute” policy language in exclusions to broaden their ability to deny coverage. This type of language can eliminate coverage in situations where it would reasonably be expected to apply.

Vague, confusing, and undefined words and phrases are a favorite tactic insurance companies use to create policy language that is almost impossible to understand unless you are a lawyer or paralegal.

Common Mistakes People Make When Dealing with Insurance Companies After an Injury

Unsuspecting and injured people – especially those who are not represented by a lawyer and try to deal with their insurance company directly — often make critical mistakes that hurt their claim.  You want to be sure to avoid these pitfalls:

Communication Mistakes

A person should never give a recorded statement to the other party’s insurance company before consulting with an attorney.  Adjusters are trained to find inconsistencies that can weaken your claim. Never admit fault or apologize for the accident.

Medical Care Errors

You should never delay or postpone medical treatment. Gaps in treatment can severely damage your case because insurance companies could argue that your injuries weren’t serious enough for you to seek immediate treatment.

Documentation and Authorization Issues

You should never sign medical authorizations for the other person’s insurance company without consulting a lawyer. Always call 911 after an accident, requesting a police officer and first responders to arrive at the scene, especially after vehicle collisions. Failing to report all injuries, even minor ones, can harm your case.  A car accident lawyer will request a police report later to help prove your case.

Neale & Fhima Goes Toe-to-Toe with Insurance Companies

If you’ve suffered an injury due to someone else’s negligence, a personal injury lawyer at Neale & Fhima will fight to get the financial compensation you deserve.  Our skilled attorneys and top-notch legal team have an outstanding record of recovering more than $50 million in rightful compensation for victims throughout Southern California.  We treat clients like family.  For a free consultation about your case, call us at 888-407-2955.