Majority of Insurance Complaints Resolved in Consumers’ Favor

Consumers are increasingly filing insurance complaints as policy and politics mix more.

Claim handling was by far the top reason for insurance complaints in 2024, according to a ValuePenguin analysis of National Association of Insurance Commissioners (NAIC) data.

Here’s what else we found.

Key findings

65.2% of closed insurance complaints involve claim handling

In 2024, claim handling accounted for 65.2% of closed insurance complaints, with delays (22.2%) and unsatisfactory settlements or offers (12.2%) as the top related claims. (Other claim-handling complaints revolve around denials, adjuster handling, prompt pay, state-specific issues and more.)

According to the National Association of Insurance Commissioners (NAIC) Market Regulation Handbook, companies are required to respond to and resolve claims promptly, though no timelines are specifically mentioned.

Meanwhile, she says claims often get settled unsatisfactorily when insurers don’t investigate the situation properly, or policy terms and exclusions are misrepresented to the policyholders. Also, there can be confusion over coverage limits and poor communication between insurers and policyholders.

Closed insurance complaints by claim type (2024)

After claim handling, policyholder service saw the next biggest share of complaints, at 20.6%. Consumers’ biggest policyholder issues were state-specific, accounting for 5.4% of complaints. (These were mainly related to home and auto insurance.) Other policyholder service issues include coverage questions, delays or no responses, premium refunds and premium notices or billing.

Accident and health insurance receives highest share of complaints

By insurance type, consumers filed the largest share of complaints related to accident and health insurance. In 2024, accident and health insurance accounted for 36.6% of insurance complaints. By coverage type, the top issues were related to individual and group insurance, preferred provider organizations (PPOs) and health maintenance organizations (HMOs).

Accident and health insurance complaints increased by 17.3% between 2021 (26,266) and 2024 (30,810).

Closed insurance complaints by insurance type (2021-24)

Auto insurance followed closely, accounting for 35.3% of insurance complaints in 2024. It received 29,734 complaints last year, up 31.6% from 22,588 in 2021. (The next section highlights what accounted for the bulk of auto insurance complaints.)

Homeowners insurance followed at 18.0%. With 15,161 complaints in 2024, it saw a 15.7% increase from 13,104 in 2021.

Of the insurance types analyzed, just one saw a decrease in the number of complaints it received from 2021 to 2024: liability insurance, at 31.0%.

Private passenger auto insurance accounts for 17.9% of complaints

Looking at coverage type, private passenger auto insurance (or personal auto insurance) received the highest rate of complaints in 2024, accounting for 17.9%.

General homeowners insurance (9.9%) and individual accident and health insurance (8.9%) followed.

Since most insurance complaints stem from claim delays and unsatisfactorily settled claims, Sangameshwar says it’s important policyholders understand what their policies do and don’t cover.

For health insurance, she recommends working with a patient advocate who can help policyholders manage their claims process while they focus on their or their family’s recovery. "Advocates can help policyholders understand their insurance policies, ensure that insurers are honoring their commitments, and assist with appealing denied claims and checking medical billing to see that policyholders aren’t overcharged," she says.

Closed insurance complaints by insurance and coverage type (2021-24)

Looking at the coverage types with the biggest increases in complaints, homeowners hazard insurance ranks first. Complaints have risen a massive 4,866.7% from three in 2021 to 149 in 2024. That’s followed by miscellaneous business interruption (which covers financial losses after a forced business shutdown due to disaster or other reasons), which rose 500.0% from one complaint to six.

Finally, preexisting condition coverage under accident and health insurance saw the third-biggest increase, 300.0%, rising from one complaint in 2021 to four in 2024.

Insurance coverage types with the largest % increases in complaints (2021-24)

Good resolutions likely for consumers

There’s some good news: Consumer wins are more likely than losses. In 2024, 26.2% of closed complaints resulted in the company position being overturned — the most likely resolution. Following that, consumers received compromised settlements or resolutions in 26.1% of cases.

Claims were settled in 18.7% of cases.

Closed insurance complaints by disposition (2021-24)

Meanwhile, the company’s position was upheld in just 4.1% of cases. (Other dispositions may play out positively for insurers, such as no action being required or a complaint being referred to the proper agency.)

Sangameshwar says the data shows appeals largely work.

"If your insurance company refuses to settle a claim in a way you think is fair or if they drop your coverage without proper reason, you have a right to appeal the company’s decision," she says. "The benefit of the appeal is that it forces your insurer to tell you why they’ve made their decision — and they also have to let you know you can dispute their decision."

Filing complaint: Top expert tips

"If you’re unhappy with your insurance company or agent, you can file a complaint against them with your state’s Department of Insurance," Sangameshwar says. "Most who file complaints do so because of their unhappiness over claims delays, unsatisfactory settlements or outright denials."

If you plan to start a complaint with your state’s insurance commissioner, here are a few tips to keep in mind: