Insurance Insights: Navigating Claims and Legal Complexities with Expert Dennis Beaver

Published Date: 01/16/2024

Navigating the Insurance Claims Maze: Legal Insights from Karl Susman and Attorney Dennis Beaver

When disaster strikes—whether it’s a car accident, property loss, or a life insurance dispute—many policyholders are left wondering: When do I need a lawyer? Should I call my agent, my insurer, or head straight to court?
In a recent episode of Insurance Hour with Karl Susman, special guest and attorney Dennis Beaver—a longtime consumer advocate and Kiplinger columnist—offered candid, experience-backed advice on how to navigate claims, avoid legal missteps, and build trust in the insurance process.

Start with the Basics: Work Within the System

Both Susman and Beaver agree that one of the most common mistakes policyholders make after a loss is immediately contacting a lawyer or public adjuster.
Beaver, who’s worked decades in insurance and consumer law, didn’t mince words:

“The worst thing you could do is immediately contact a lawyer, regardless of what the claim is. Always try to work within the system first—with your adjuster, your insurer, and your agent.”

In other words, the first step is not litigation—it’s communication.
Insurance companies have structured claims departments designed to resolve issues internally. Going outside the system too early often adds unnecessary complexity, delays, and fees that could otherwise be avoided.

If your claim isn’t progressing, Susman recommends escalating through proper channels—first your adjuster’s supervisor, and then your insurance agent or broker. Agents and brokers, unlike anonymous call centers, can often advocate for you directly. “That’s part of the value we bring,” Susman says. “When clients can’t get the response they need, we step in.”

When It’s Time to Call a Lawyer

There are situations when bringing in an attorney makes sense. Beaver lists a few red flags:

• You’re being ignored. If your calls go unanswered or your insurer isn’t investigating your claim, you may need legal help.
• The adjuster is “playing games.” Lowball offers, misrepresentation of coverage, or excessive delays can justify legal action.
• There’s a serious injury or complex loss. In cases of major bodily harm, wrongful death, or high-value property damage, experienced counsel is essential.

Still, Beaver stresses that many people overestimate what attorneys can achieve in minor claims:

“With a simple fender bender or minor injuries, it’s the rare case when an attorney can get you much more than you can negotiate yourself with an adjuster.”

Attorneys also don’t work for free—most personal injury lawyers take one-third of any settlement. For small claims, that fee can eat up most or all of what you’d gain.

The Temptation of Fraud—and Its Consequences

A major theme of Beaver’s stories is how small lies can snowball into legal disasters. From embellished claims to outright fraud, he’s seen it all.
One client claimed her work van—with the keys and $20,000 in cash inside—was stolen. When Beaver pressed her for details, her story unraveled. “Nobody believes you,” he told her. “This is attempted insurance fraud.”

The lesson? Honesty is non-negotiable.
Insurance fraud—even “minor” embellishments—can void your claim and land your name on national fraud registries. Worse, it can follow you for years, making it harder to obtain future coverage.

As Susman noted, even a single false statement can torpedo an entire claim:

“If you file a claim with ten items, and one of them is found to be false, that could be grounds to deny the entire claim.”

That means “adding your deductible” or padding your loss estimate—common practices some consumers shrug off—can be legally catastrophic. Fraud doesn’t just mean lying about the cause of a loss; it includes exaggerating values, backdating coverage, or falsifying receipts.

Trust the System—But Verify Everything

Beaver and Susman also discussed the importance of trust—both in your insurer and in the process. Most claims aren’t denied maliciously; they’re delayed or disputed due to documentation gaps, misunderstandings, or communication breakdowns.

For example, a bizarre but true case involved a garage fire where the claimant insisted she lost dozens of boxes of Charmin toilet paper. Initially, it looked like a red flag. But after documentation and psychological evaluation, the claim was validated—the insured suffered from a rare compulsive disorder that explained the stockpile.
As odd as it sounded, the insurance company ultimately paid.

Beaver’s takeaway: “Trust the process first. Let the system work before you assume bad faith.”
Insurance adjusters are trained to question inconsistencies, but they also follow due process. If your claim is legitimate and well-documented, the system often corrects itself.

When to Escalate Beyond Your Insurer

Sometimes, even persistence isn’t enough. That’s when regulatory intervention comes in.
Beaver shared an example involving a life insurance dispute: a widow who had continued paying premiums for years after retirement, only to have her husband’s claim denied because the policy was “supposed to end.” The insurer offered to refund the premiums—but not pay the death benefit.

Beaver took the matter to the California Department of Insurance, which ruled in the widow’s favor. The insurer had accepted payments and thereby created an expectation of coverage. Legally, it was “estopped” from denying the claim.

While Beaver admits the DOI doesn’t intervene in every dispute—particularly when it’s a gray area over claim values—they can be powerful allies in cases of neglect or wrongful denial. “If you’ve been ignored and it’s black and white, that’s when they step in,” he says.

The Cost of Small Claims—and Why You Might Pay Out of Pocket

Beaver also cautions against filing small claims that could affect your future insurability. “If you can afford to pay for the damage yourself, do it,” he advises.
Why? Because insurers classify policyholders by risk tiers. Even one minor claim can move you into a higher-risk category, raising your rates or limiting renewal options.

Susman echoes the point: “Insurance isn’t a savings account. It’s designed for catastrophic losses, not financial inconveniences.”
In other words, save your coverage for when you truly need it.

Lessons Beyond Claims: Legal Insight Meets Human Behavior

Beyond insurance law, Beaver’s stories delve into human psychology—why people make poor decisions, avoid responsibility, or rationalize unethical actions.
In his Kiplinger column, he explored “How to Raise a Failed Adult,” highlighting how overprotective parenting can breed entitlement and, in extreme cases, criminal behavior. “When the tap gets turned off,” Beaver says, “some kids resort to violence or fraud because they were never taught accountability.”

The parallel to insurance behavior is clear: entitlement and impatience often lead to mistakes—filing unnecessary claims, exaggerating losses, or blaming insurers for preventable outcomes.

Empowerment Through Education

The conversation between Karl Susman and Dennis Beaver underscores a simple but profound truth:
Understanding your insurance and your rights is the best protection you have.

Here are the core takeaways:

1. Start within the system. Work with your adjuster and agent before seeking legal action.
2. Document everything. Keep records, photos, receipts, and correspondence.
3. Be honest. Even small lies can void a legitimate claim.
4. Know when to escalate. The Department of Insurance is a last resort, but a powerful one.
5. Save claims for real losses. Avoid filing small claims that can raise your rates.
6. Do your research. If you hire an attorney, check their bar record and local reputation.

The Bottom Line

Insurance may seem like a maze of fine print and frustration, but as Susman and Beaver remind us, the system largely works when approached with patience and transparency. Fraud and fear erode trust; communication and integrity rebuild it.

Beaver summed it up best:

“Trust the system first. Don’t be an idiot—tell the truth.”

For California homeowners, drivers, and business owners navigating today’s volatile insurance market, that advice has never been more timely—or more valuable.