Denied Insurance Claim in Toronto? What to Do Next

Introduction

In Toronto, real estate and property ownership come with a myriad of responsibilities. One of the most significant aspects is ensuring that the property is protected from unforeseen damages or incidents. Property owners often rely on insurance companies for this protection. However, sometimes insurance companies will deny claims. This guide explains what to do if your insurance claim is denied, helping you understand the steps needed to resolve the issue and secure the compensation you deserve.

Common Reasons for Denial

Insurance claim denial can occur for various reasons. Understanding the root cause is the first step in resolving the issue. Here are the most common reasons for denial:

• Wrong or missing coverage

• Non‑payment of premiums

• Failure to meet conditions for coverage

• Disputed or incomplete evidence

• Insufficient documentation

Understanding the Claim Denial

When you receive a denial letter, the insurer will usually outline the specific reason for denial. Common reasons include:

• Coverage does not apply to the type of loss.

• Policy is no longer active due to missed premiums.

• Policy conditions were not met (e.g., required notice not given).

• Evidence submitted was incomplete or inconsistent.

• Policy limits exceeded.

The Claim Process

Typically, the claim process in Toronto begins with you filing a claim within the timeframe specified by your policy. You then submit supporting documentation and may be required to provide additional details. The insurer reviews your claim, and if it meets the policy terms, they issue a settlement. If they find the claim does not meet policy terms, they will issue a denial letter. Understanding each step helps you identify where the claim fell short and what corrective action is needed.

Dispute Resolution

When you believe the denial is unjust, you can file a dispute. In Ontario, the Insurance Ombud Service (IO) offers a free, independent review of your claim. To initiate a dispute, you must:

• Submit a formal dispute within 30 days of receiving the denial letter.

• Provide any additional evidence that was omitted or clarify inconsistencies.

• Wait for the IO to review your case and send a recommendation.

If the IO recommends payment, most insurers comply. If the insurer rejects the recommendation or remains unconvinced, you may need to consider legal action.

Legal Recourse

If the insurer refuses to reconsider or the IO recommendation still results in denial, you have the option to file a lawsuit in Small Claims Court or the Superior Court, depending on the amount of compensation sought. The litigation process typically involves:

• Filing a claim and serving the insurer.

• Discovery and depositions.

• Settlement negotiations.

• Trial and judgment.

Legal action is often the most effective way to compel the insurer to honor your policy, especially when the denial is based on ambiguous policy language or procedural errors.

When to Seek Legal Help

You should consult a lawyer early if:

• The denied amount exceeds $5,000.

• You face a complex policy interpretation.

• The insurer is unresponsive or dismissive.

• You are dealing with a commercial policy with higher stakes.

Our Toronto law firm specializes in insurance disputes and can provide you with the guidance needed to navigate this process effectively.

Conclusion

In Toronto, a denied insurance claim can be frustrating, but it's not an impasse. By understanding the common reasons for denial, reviewing your claim details, and following a clear dispute or legal strategy, you can often recover the compensation you're entitled to. If you need assistance, contact our team today to start your claim recovery journey.

Ready to take the next step? Schedule a free consultation with our Toronto legal experts now.