Repeated Disappointments in the Insurance World
It’s no longer a secret that many entrepreneurs inBanten Province – starting from MSME actors in Serang, factory in Cilegon, until logistics company in Tangerang – feel frustrated and disappointed towards insurance services.
They pay premiums every year, hoping to have full protection when disaster strikes. However, the reality is often the opposite:
“Our claim was rejected for reasons we don’t understand.”
Stories like this repeat themselves almost every month: a factory burns down, a warehouse floods, or heavy equipment is damaged during shipping — but insurance claims are denied.
This article will dissect the most common reasons why claims are denied, as well as how PT. Liberty and General Insurance Broker (L&G Insurance Broker), licensed insurance brokerOJKwhich is based inBintaro, South Tangerang (Banten), helping many entrepreneurs change the results of a rejected claim into a paid claim.
- The Phenomenon of Rejected Claims: Why Does This Happen?
Insurance claims are the most crucial and sensitive process in the relationship between the insured and the insurance company.
However, many entrepreneurs in Banten do not understand that each claim is subject to the contents of the policy contract— and this is where the source of the problem arises.
🔹a. The policy is not suitable for the type of risk.
Many companies purchase insurance policies quickly from sales agents, without process risk assessment.
As a result, the contents of the policy do not correspond to real conditions in the field.
Example:
A plastic factory inCikande, Serang, includes a “fire insurance” policy for the building.
However, the fire was caused by a chemical explosion — which the police should have guaranteed.Industrial All Risks (IAR).
The claim was rejected because the risk of explosion was not covered in the basic policy.
🔹b. Unknown Exclusion Clause
Almost every insurance policy has a long list of “risk exclusions.”
Unfortunately, many customers do not read or are not explained in detail by the agent.
Common examples:
- Standard fire policy does not guarantee floods or earthquakes, unless purchased additionally.
- Police machinery breakdown does not cover operator error.
When a claim is filed, the insurance company simply points to the exclusion clause — and the customer can simply accept the results.
🔹c. Insufficient Insurance Value (Underinsurance)
Classic problem in Banten: many business owners reduce the insurance value so that the premium is cheaper.
However, when a loss occurs, the insurance company pays proportionally (average clause).
Example:
The actual assets are Rp. 20 billion, but only Rp. 10 billion is insured.
When a fire worth Rp. 8 billion occurred, the insurance company only paid Rp. 4 billion (50%).
🔹d. Incomplete Claim Documents
The claim process requires administrative evidence and a neat chronology of events.
However, many entrepreneurs do not have adequate police reports, loss reports, or photos of the incident.
As a result, claims are delayed for months, or even rejected because they are considered there is no sufficient evidence.
🔹e. No Professional Companion
This is the biggest cause of all the above problems.
Most of the entrepreneurs in Banten deal directly with insurance companies without expert assistance.
They don’t understand the technical details, policy legal language, and claims negotiation strategies.
In fact, in the world of international insurance, Every insured should have an insurance broker as a professional advisor.
- Financial Impact of Claim Rejection in Banten
Claim denials aren’t just a temporary loss — they can permanently damage a business.
Several field studies show real impacts on the ground:
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From the example above, it can be seen that Most claims are rejected not because the insurance company doesn’t want to pay, but because the policy was drafted incorrectly from the start.
- Solution: The Vital Role of Insurance Brokers in Preventing Claim Rejections
This is where the importance of presence lies.independent insurance brokers such as PT. Liberty and General Insurance Broker (L&G Insurance Broker).
As risk consultants and professional intermediaries who work for clients (insured), L&G plays a role in ensuring that insurance policies are properly structured from the beginning until the claim process is completed.
🔸a. In-depth Risk Analysis
L&G does risk assessment directly at the business location.
The professional team will identify potential hazards such as:
- electrical systems and fire protection,
- flood-prone locations,
- warehouse layout,
- and compliance with occupational safety (HSE) standards.
The results are used for adjusting the policy type and clauses so that there are no loopholes that insurance companies can exploit to reject claims.
🔸b. Preparing an Appropriate and Comprehensive Policy
The broker ensures that all possible risks are covered in the contract, for example:
- Adding flood extension for the Tangerang area,
- Explosion coverage for the Cilegon chemical factory,
- Earthquake and Storm coverage for coastal areas such as Anyer and Pandeglang.
In addition, L&G also negotiates the best premium to several insurance companies simultaneously, so that customers get a combination of efficient pricing and optimal protection.
🔸c. Claim Process Assistance
When a loss occurs, L&G Insurance Broker’s team will:
- Assisting customers in preparing all administrative documents.
- Submit a claim report according to the policy provisions.
- Negotiate directly with loss adjusters and insurance companies.
- Ensure claims are not complicated or delayed.
With this professional approach, the chance of a claim being approved increases by up to 90% compared to customers without broker assistance.
🔸d. Annual Audit and Policy Renewal
Many claim rejections occur because the policy has expired or has not been renewed according to changes in assets.
L&G regularly performs policy review annually to ensure all new assets, insured amounts and risks are covered.
- Case Study: A Rp12 Billion Claim Saved by a Broker
In 2024, a chemical factory in Cilegon experienced an explosion that destroyed most of the production facilities.
The insurance company initially rejected a claim worth Rp. 12 billion on the grounds that “chemical reactions are not covered under standard fire policies.”
However, afterInsurance Brokerstepped in, their legal and technical team discovered that the policy should have included coverage for “explosion caused by gas pressure” — and laboratory evidence supported that claim.
After 2 months of intensive negotiations, the insurance company finally agreed to full payment.
This case is strong evidence that Insurance brokers are not just intermediaries, but defenders of customer rights.
5. Types of Insurance that Most Often Cause Problems in Banten
Based on L&G’s experience in the field, here are 5 types of policies that most often cause claim disputes:
- Property/Fire Insurance – often does not cover the risks of floods, earthquakes and explosions.
- Machinery Breakdown Insurance – often misunderstood as the cause of engine failure.
- Contractor’s All Risks (CAR) – often rejected due to errors during field work.
- Marine Cargo Insurance – common problem: goods are damaged but there is no evidence of damage at the port.
- Business Interruption Insurance – difficult to claim without accurate proof of financial loss.
All these problems can be minimized if the policy is drafted properly.correct risk analysis and wording by professional brokers.
6. Estimated Premium Costs and Benefit Value
Some entrepreneurs are still hesitant to use brokers because they think the fees are expensive.
Whereas, The customer does not pay anything extra to the broker.
Brokers get official commissions from insurance companies, without increasing your premium.
As an illustration:
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With broker assistance, you get proper guarantees, efficient premiums, and a guaranteed claims process.
7. Ideal Insurance Claim Process with L&G
When a disaster occurs, the following are the standard steps implemented byL&G Insurance Broker:
- Initial Report (Notice of Loss) within a maximum of 3×24 hours.
- Collection of evidence and documentation (photos, videos, minutes, police reports, and invoices).
- Official notification to insurance company and loss adjuster.
- Field inspection assistance.
- Negotiation of loss value and validation of policy contract.
- Claim payment to the insured.
With this system,the chances of a successful claim increase and the resolution time is much faster.
8. How to Avoid Claim Rejection in the Future
L&G Insurance Broker provides simple but effective tips:
- Use a broker from the beginning of the policy purchase.
- Conduct an annual risk survey.
- Update the insurance value every time assets increase.
- Read and understand the exclusion clause.
- Keep all documents and physical evidence safe.
- Report the loss immediately after the incident.
This simple step has been proven to be effective to avoid 80% of potential claims being rejected.
9. Why Choose L&G Insurance Broker?
- Officially licensed and supervised by OJK.
- More than 20 years of experience in the national and international insurance industry.
- Specialist industry, construction, marine, and liability.
- Office inBintaro, South Tangerang, easy to reach in all areas of Banten.
- Known for a track record of successfully handling large claims of up to tens of billions of rupiah.
10. Conclusion: Don’t Face Claims Alone
A claim denial isn’t the end of the world — if you have a competent insurance broker by your side.
Don’t let complicated contracts and claims procedures make your business suffer.
Entrust your business protection toPT. Liberty and General Insurance Broker (L&G Insurance Broker) —
professional partners who are always on your side.
💼 Consult your risks and insurance policies now.
📍 Office: Bintaro, South Tangerang – Banten
🌐 Website: www.lngrisk.co.id
📞 Email: info@lngrisk.co.id
HOTLINE L&G 24 JAM: 0811-8507-773 (CALL – WHATSAPP – SMS)
L&G Insurance Broker – Protecting Your Business from Risk, Not Just Selling Policies.
