Did Your Auto Insurance Company Act in Bad Faith?

March 8, 2024

Each year, the National Association of Insurance Commissioners tracks the top reasons why insurance customers complain about their auto insurance coverage… and each year, “denial of claims” makes the top three. It’s not surprising that every day in Oklahoma auto insurance companies deny and delay claims. In some cases, their decisions are warranted, but in many others they are acting in bad faith.

When you purchase your car insurance policy in good faith, and pay your premiums on time, you expect that your claims will be paid expeditiously and in accordance with your policy.

Unfortunately, this doesn’t always happen. It’s not surprising that if you receive a denial letter you are frustrated. Understanding the reasoning behind the denial is key to knowing what to do.

Individuals living in Oklahoma have legal recourse when their car insurance claims are denied in bad faith. Appreciating the goals of your insurer, understanding the reason for the denial, recognizing common bad faith decisions, and acting appropriately can help you receive the claim to which you are entitled.

Automobile Insurance Companies’ Loyalties Can Be Confusing

Your Well-Being Is Not Their Primary Concern

In Oklahoma, insurance policy language is confusing, and the business laws are complex. And the operating structure of the insurance industry can be deceiving. While you may think that your insurance carrier is loyal to you and has an incentive to pay your claims quickly and fully, you would be mistaken. These organizations’ loyalties are to their shareholders; their jobs are to maximize their profits. This puts you, as a consumer, at a distinct disadvantage. You see, every claim that you submit and they pay, is an expense; it decreases their profits. Thus, there is a very real incentive to minimize paid claims.

That said, there are laws in place to protect policyholders.  In Oklahoma, these organizations must act in good faith. This means that their actions should be transparent, they must abide by the terms of the policies they sell, and the claims process should be efficient. When they don’t act in good faith, you have recourse.

Why Was Your Claim Denied?

Did Your Insurance Company Act in Bad Faith?

In order to determine the best way to respond to your car insurance company’s claim denial you need to understand the reason behind their decision. And you must be patient. Auto claims can take time to work their way through the system; your insurer may have a legitimate reason for not paying a claim. Some claim denials are reasonable.

On the other hand, if your claim should have, in fact, been covered based on the language in your policy, then the company’s bad faith actions may be at the heart of the refusal. The good news is that you have recourse against this unscrupulous and illegal behavior.

Bad faith can be claimed when the reasons at the heart of your insurance company’s denial include using stalling tactics to delay claim payouts, unreasonably underpaying a claim, or even refusing to pay a claim altogether.

Under Oklahoma law, your insurance carrier has a legal obligation to treat its policyholders fairly.

While specific legal obligations vary based on the type of policy and coverage you purchase, your insurer must investigate and resolve your claims in a fair and reasonable manner in order to comply with the duty of good faith owed to its policyholders.

However, while insurance companies do have the right to fully investigate claims, and investigations do take time, in many cases delays mean an insurer is acting in bad faith. They may be stalling, attempting to delay the claim in the hopes that you will get frustrated or confused, or even give up in your pursuit of your rightful compensation.

If you are unable to determine exactly why your claim was denied and you suspect your carrier may have acted inappropriately, consider contacting an Oklahoma bad faith insurance lawyer.

An In-Depth Look at Common Auto Insurer Bad Faith Tactics

Recognizing Specific Behaviors

Every automobile accident is unique, as is its impact on the individuals involved. Thus, it makes sense that the insurance companies’ responses would be tailored to each specific situation. That said, one thing that many auto insurance claims seem to have in common is the fact that they were denied in bad faith. Below are some of the most common bad faith actions taken by insurance companies.

• Disregard for Policy Language: Every automobile insurance policy has very specific language that delineates the policyholder rights, including types of coverage and coverage limits. When your insurance company denies your claim based on policy language, but cannot justify the exact reason why, they are acting in bad faith. Quite simply, they must be able to identify where in your policy your damages were excluded.
• Purposefully Underpaying Valid Claims: These “low ball’ settlements intentionally provide compensation that is inadequate to cover past, present, and future damages (for medical bills, pain and suffering, property damage, etc.) associated with the accident.  Insurers often issue these offers in hopes that their clients will simply accept them without pushback.  Because the claims process is so difficult and so many policyholders are unaware of their rights under the law, this tactic is often successful and saves these companies a lot of money.
• Using Biased Experts:  While insurance companies have the right to fully investigate accidents, they are supposed to do so in good faith. In many cases these investigations require expert opinions. Unfortunately, often the professionals they engage (doctors, engineers, mechanics, and so forth) are biased in favor of the insurance company.  They work with these professionals knowing their expert opinions will be in the company’s best interests regardless of the evidence and facts.
• Purposeful Claims Delays: Insurers consistently leverage time as a weapon in the claims process by repeatedly delaying  claims or continuously requesting additional information.  They know their clients are anxious for their compensation; these funds are necessary to pay their expenses and repair their vehicles. They delay claims in hopes that their clients will ultimately accept less than they deserve just to complete the process and move on with their lives.  Unfortunately, many do.

If you believe your claims denial was the result of any of these behaviors, you may have grounds for a bad faith insurance lawsuit.

Doug Terry Law Can Help Fight Back Against Bad Faith

What We Can Do For You

Because the laws governing insurance companies’ actions are so complicated and dealing with an insurance company is so time consuming and frustrating, many policyholders simply accept their insurer’s denials as final. They don’t understand their rights or how to address these decisions. To be honest, the process is incredibly confusing; engaging the advice and counsel of an experienced Oklahoma bad faith insurance lawyer can be beneficial.

Your auto insurance bad faith claims lawyers manage the entire legal process on your behalf. First, they will review your policy to understand your coverage, limits and deductibles taking time to identify the following areas:

• Personal liability
• Property damage
• Comprehensive and collision
• Uninsured/underinsured motorist (“UM”) coverage.

Additionally, they will review your claims submissions and the insurance company’s responses to identify any bad faith actions. They will also help to identify and quantify all appropriate damages. Your Oklahoma bad faith insurance lawyer will communicate with the insurance company on your behalf and work to negotiate a settlement. Of course, they can always take your case to court if necessary.

Quite often, simply having an attorney communicate on your behalf can expedite the process and result in an appropriate settlement.

Contact Us Today

If you are struggling with an auto insurance claim denial, you want to leverage time. Not only are there deadlines for appeals and legal action, but you also want to secure a settlement as soon as possible. You likely need your insurance reimbursement to pay your expenses. That’s why it is important to act quickly.

Oklahoma auto insurance claim lawyer Doug Terry is ready to leverage his knowledge and experience and go to work for you immediately. Since 1993, he has been working to maximize settlements for auto insurance policyholders.  Contact him today at 405-463-6362 to schedule a free consultation and learn how Doug can help you move forward.