Short Answer

In North Carolina, an insurer may deny a claim for lack of coverage only if, after a reasonable investigation, it determines no policy covered you or the accident at the time of the loss and it explains the reason in writing. A denial based merely on missing or incomplete records is not enough; the company must take reasonable steps to verify coverage. If coverage did exist, a denial for “no coverage found” may be improper.

Understanding the Problem

You want to know whether a North Carolina auto insurer can deny your injury claim because it says it cannot find your policy. Here, the adjuster reports no policy in your name and plans to deny for “lack of coverage.” The narrow issue is whether the insurer can lawfully deny on that basis after a crash-related claim.

Apply the Law

North Carolina law requires insurers to investigate claims using available information before denying them and to provide a clear explanation if they deny. An insurer can lawfully deny for lack of coverage when it determines, after a reasonable investigation, that no applicable policy existed, you were not an insured under any relevant policy, or the loss falls outside the policy’s scope. Coverage disputes are typically addressed with the North Carolina Department of Insurance or, if needed, in court. Personal injury lawsuits generally must be filed within three years from the crash.

Key Requirements

• Reasonable investigation: The insurer must try to verify coverage using available identifiers (names, addresses, VIN, dates) before denying.
• No applicable policy in force: A denial is proper only if no policy covered you or the vehicle at the time of the crash (or the event falls outside policy terms).
• Insured status and scope: You must be an insured or otherwise covered under the policy’s definitions; if not, the insurer can deny.
• Clear written explanation: The insurer must state the specific reason it is denying the claim for lack of coverage.

What the Statutes Say

• North Carolina Gen. Stat. § 58-63-15(11) (Unfair claim settlement practices) - Bars denying claims without a reasonable investigation and requires fair claim handling.
• North Carolina Gen. Stat. § 20-279.21 (Motor vehicle liability policy provisions; UM/UIM) - Sets core auto policy requirements, including uninsured/underinsured motorist coverage.
• North Carolina Gen. Stat. § 1-52 (Three-year statute of limitations) - Most negligence claims must be filed within three years.
• North Carolina Gen. Stat. § 1-253 (Declaratory judgments) - Allows a court action to determine insurance coverage rights.

Analysis

Apply the Rule to the Facts: The insurer says it cannot find a policy in your name. It must still reasonably investigate—searching by your prior addresses, driver’s license, VIN, and any business names—before denying. If, after that investigation, it confirms no policy existed or you were not an insured when the crash occurred, it may deny and must explain why. If its records are incomplete but you produce proof (cards, declarations, bank statements showing premium drafts), a denial for “no coverage found” may be improper.

Process & Timing

1. Who files: You. Where: Start with the insurer’s claims department and, if needed, the North Carolina Department of Insurance Consumer Services Division. Court relief is in the Superior Court for your county via a declaratory judgment. What: Send a written coverage verification and preservation request, attaching any proof (ID cards, declarations, VIN, accident report). For court, file a civil complaint seeking declaratory judgment under § 1-253. When: Do this promptly; keep the three-year personal-injury filing deadline in mind.
2. Ask the insurer to search by all identifiers (full legal name(s), prior addresses, VIN, policy number on the police report, and any business names). Request a written denial letter that states the precise reason and the records checked.
3. If the insurer still denies, file a DOI complaint with your claim number and documents. If coverage remains disputed, consult counsel about suing the at-fault driver and, if appropriate, seeking a court ruling on coverage or notifying your own UM/UIM carrier.

Exceptions & Pitfalls

• Commercial vs. personal policy: If the policy was in a business name, the insurer should search by that name and VIN, but you must supply leads. Missing business records can delay verification.
• Police report errors: Policy numbers on crash reports are often wrong. Do not rely solely on the report; provide alternate proof of coverage.
• Cancellation issues: A lapsed policy can justify denial, but insurers must follow North Carolina’s notice rules. Ask for the cancellation notice and effective date.
• UM/UIM notice traps: If the at-fault driver is uninsured or coverage cannot be confirmed, promptly notify your own UM/UIM carrier and follow your policy’s cooperation and consent-to-settle requirements.
• Statute of limitations: Do not wait on coverage disputes so long that you miss the three-year deadline to sue for your injuries.

Talk to a Personal Injury Attorney

If you're facing a potential claim denial because the insurer says it can't find your coverage, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at [919-341-7055].

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.