- January 26 2023
- | Insurance

Nevada law gives insurance companies an opportunity to settle a claim in a timely manner after a claim has been filed. There are laws that give you protection in case they fail to obey these rules, and there are ways that an insurer can extend the deadlines if necessary.
If you believe that your insurance company has given you the runaround or that your claim was unfairly denied because the insurance company delayed processing your claim, what can you do?
Deadlines and Timelines
To Begin With, How Long Does an Insurance Company Have to Investigate a Claim?
Nevada regulations require an insurer to begin investigating your claim within 20 working days of receiving it. If the insurer needs more information about the claim, it must send you a “proof of loss” request within that 20-day period. This proof of loss may be a request for additional reports, receipts, or statements about the claim.
Once the proof of loss has been received, the insurer has 30 days to accept or deny the claim as submitted. Once the claim has been accepted, and while the claim is being investigated, the insurer must notify you about the investigation’s status.
If an insurance company fails to meet these deadlines, it could mean the insurance company is acting in bad faith and it is a warning sign to you that something is amiss.
The Investigation Process
Once the insurance company has received your claim, they must investigate it to make sure it is valid. Depending on the type of claim and extent of the loss, investigating can take considerable time. How long does it take for an insurance company to process a claim?
- They will collect and review documents related to the incident. These may include property damage reports, repair estimates, hospital bills, and anything that can corroborate the amount of the loss.
- They will interview you and any other witnesses to the event and the loss. For instance, if your house was damaged in a fire, they will ask you how the house caught fire and which parts of the home were spared.
- They will investigate the damage and take photographs of the area. They may ask for third-party estimates if they are unsure of the amount of loss.
- They will compare your claim with your policy to determine if you have coverage for the loss you are claiming. If your policy does not cover flood damage, then you can’t make a claim for flooding, but you might be able to claim water damage.
Lack of Assistance Through the Claims Process
The storms that blew through the Reno area this past winter left many people with insurance claims to file. For some, it may be the first time they’ve had to make a claim for snow or wind damage. The insurance company is supposed to help customers file their claims and provide assistance when needed, but that doesn’t always mean they do.
One issue many clients have with their company is the “rotating adjuster.” It is common for insurance companies to have multiple adjusters handle a policy or claim. This leads to frustration when you have to explain your claim for the third time to a new adjuster and ask for help yet again in filling out your forms.
Filing Forms the Right Way
Many insurance claims are denied the first time they’re submitted. The primary reason for the denial is improperly completed forms. You might think that your insurance company would want you to fill out your form correctly the first time, but they often leave you to figure it out on your own.
When you have questions about how a form should be completed, or are unsure about what documents are required, the first person you should call is your insurance adjuster or agent. Nevada law requires insurers to provide you with the forms and instructions to complete your claim as easily as possible..
If your insurance adjuster or agent isn’t being helpful, it is strongly suggested that you seek legal assistance. You should also keep a careful record of your contact with the adjuster or your agent in case you need to file a bad-faith lawsuit.
Deliberate Delays
Once you’ve sent in your forms, the insurance company must either accept the claim or let you know they need more time to investigate within 30 days. Any time the insurer needs to extend the investigation, they must contact you in writing to explain the reason for the extension and tell you the investigation may take up to another month to investigate.
Just because the insurance company is extending the investigation, this does not mean they’re dealing in bad faith. Disasters, complex accidents, and uncooperative third parties can all prevent an insurance company from completing an investigation in a timely manner.
However, if the company sends the same forms repeatedly or asks for more detailed information than necessary, this may be an effort by the insurance company tp delay the process. If they need the forms again, they must state why — for instance, the first forms were lost or incomplete.
Nevada’s Unfair Insurance Practices Act requires companies to explain why they are asking for more information and more time whenever they make such a request. Failure to do so violates the Act and fair claims practice standards You should consider seeking legal assistance when this happens.
Settling Your Claim
Once you’ve sent in all the paperwork and the investigation is complete, how long does an insurer have to pay a claim? The insurance company must pay you within 30 days of approval.
You should never accept a settlement offer without having an attorney review it first. Even if you haven’t retained an attorney before, you should at least have one look at the offer before you accept. The attorney will make sure you are receiving the correct amount, that the claim was thoroughly investigated, and that you haven’t waived any rights to future litigation by accepting the settlement.
Litigating a Bad Faith Claim
Nevada law limits the time you have to bring legal action if you’ve been the victim of bad faith insurance practices. Nevada’s Unfair Insurance Practices Act also specifically provides a private right of action for violations of that Act. Nevada Unfair Insurance Practices Act provides the minimum standards by which claims in Nevada must be investigated and handled.
Please be aware that your insurer may have a clause in their policy that limits the time you have to file a claim against them. This varies from company to company but is usually 12 months from the date of loss. Nevada courts have determined the 12 month time limit to sue is tolled for the period of time between when a claim is made and when the insurer makes a final decision so as to prevent an insurer from running out the 12 month clock “investigating” the claim.
You should review your policy carefully to determine the amount of time you have to file your claim and what steps you need to take before beginning litigation.
Elements of Proof
Proving your claim means showing that you had a valid claim that was unreasonably denied. That sounds simple enough, but in practice it is difficult to show. You will need the services of an attorney who knows exactly what is needed by the court. You may need to prove that . . .
- There was a valid claim based on the terms of your policy. If your policy had any exclusions or limitations, your claim may not have been valid.
- The denial was unreasonable. You must show that the insurer deliberately denied a valid claim or made an improper offer.
- Proof of pressure to accept a settlement, failure to explain a denial or reason for extension and excessive demands for additional information are all essential to prove claims of bad faith. Always keep careful records of your contact with your agent.
Costs and Benefits of Litigating Your Claim
You should always consult an experienced bad faith attorney before attempting legal action against an insurance company. These cases are complicated, and there are steps you need to take before you can enter the courtroom. These steps should be outlined in your policy.
Your attorney will advise you on the costs and benefits of litigation and whether your case is worth pursuing. For instance, if there was only a brief delay in the investigation or the insurance company seems willing to negotiate, you might consider alternatives to expensive and time-consuming legal action.
However, if you believe you have been defrauded by your insurer or they have used unfair practices to force you into a settlement, you need to take them to court. To do that, you need the legal services of Leverty & Associates Law Chtd.
Leverty & Associates Law Chtd. represents individuals and businesses in bad faith litigation. We understand that not every denied claim is bad faith. It takes experience and knowledge of Nevada insurance laws, regulations, and practices to determine if your claim was unreasonably denied.
At our firm, we have the unique resources and background to properly evaluate the insurance company’s actions. If you think your insurance company is treating you unfairly, contact us at (775) 322-6636 in Reno or (702) 286-9411 in Las Vegas for a free consultation. We want to help you understand your rights when dealing with an insurance company.