Why do insurance companies not want to pay, when they know they should?

That is how they make money. They collect premiums from customers. When they have to pay out for a claim, they lose that profit. So, they try to pay as few claims as possible.

It's called the law of large numbers. Sure, they will have to pay out some claims, but there are also other customers for whom they will never have to pay a dime. In order to make as much money as possible through that system, they have to pay as few claims as possible. Thus, all the trouble getting your claim paid.

Because they are greedy bastards!!

coz they have to pay

Because they don't make money if they pay out claims...

That's American capitalism for you. The company's advertising says they're about you and yours, but they're really about bagging loot. That's all. And the best way to that is to scare the $h!t out of you so you're convinced you need insurance, then charge you outrageous amounts monthly for the rest of your life, then refuse to pay you when you file a claim-- even if you've been paying insurance for decades and never had a claim before!

It's American capitalist genious! Yeah, America!

It is abusiness, same as any other. They dont want to pay because they're losing money.

To discourage people from filing frivolous claims. They've gotten really bad about it since America has become a sue-crazy country. Often when a company gets sued, they have an insurance company both defend them (which is expensive) and to pay the damages if they lose (which is REALLY expensive). So insurance companies are seen as deep pockets by attorneys.

So they fight tooth, claw and nail for every claim that's filed. Even when they know they're supposed to pay, they'll take the chance and deny it a few times to see if the person will stop or pay it themselves.

Also, they are often victims of fraud by people who fake injuries, etc. They will often deny a claim in an effort to find out whether it's a genuine claim or someone looking for early retirement.

Exercising due diligence on a claim is just normal and should be expected. But if an Insurance company after investigating the claim knows they have to pay and doesn't, then that is a crime and should be sued.

Why would companies do that? For the money.

Many insurance companies perform due diligence of all claims filed. They determine whether there is coverage within the policy for the specific claim and review all facts of the claim including having a claim person interview the claimant (in many instances) and review the actual claim site (property or location).

If after review of the facts and policy the insurance company determines that the claim is covered they should make payment to the claimant in a timely manner, subject to the terms of the policy - coverage limits, deductible, etc.

If the insurance company knowingly should pay the claim and refuse to, then they are breaking the law. The insurance policy you have is a written contract. An agreement between two parties. If the contract terms are not met, you should seek legal counsel and pursue legal action against the insurance company.

You can also contact your state Department of Insurance to look into the matter and file a complaint with them.

The reason they do not pay when they know they should could be any of the following:

They are greedy and want to keep the money. They think you won't pursue any legal action against them. They want to make sure it is not a frivolous claim. If you come back again to them about the claim with a letter from a lawyer, they will probably respond and pay you. They are trying to reduce their work load. They have financial problems and can't pay the claims. They have poor management and do not follow up on all claims. There could be any number of reasons or a combination of all these reasons.

I hope that helps!