February 20, 2019

This can be a complicated question sometimes, but the short answer is if you believe your insurance company is treating you unreasonably and unfairly, you should probably seek the advice of an experienced insurance bad faith lawyer.

When you file an insurance claim for a covered incident—whether it be a health insurance, auto insurance, home insurance, or other claim—you expect to be treated fairly by your insurance company. After all, you did your part by paying your premiums and following the claims process. Unfortunately, insurance companies don’t always have your best interests in mind; as such, they may operate in bad faith by short-changing you or even outright denying your claim.

When this happens, it is important to understand your legal rights to request documentation from your insurer—as well as the other steps necessary to potentially pursue a bad faith case against your insurance company.

What Is Insurance Bad Faith?

Specifically, insurance bad faith refers to a situation where an insurance company violates the duty of good faith it owes to its policyholders. The duty of good faith requires an insurance company to treat its policyholders reasonably, fairly and in good faith.  This requires the insurance company to investigate and decide claims fairly, looking just as hard for reasons to pay the claim as for reasons to deny it. When an insurer acts in bad faith, it can be held accountable in court and may be required to pay significant money damages.

Common Examples of Insurance Bad Faith

There are many actions by an insurance company that could be considered acting in bad faith. One example is when an insurance company denies a claim by claiming there is no coverage under the insurance policy, even though there is. In other cases, a settlement or payout may be offered, but the amount may be a “lowball” offer that is only a fraction of what the policyholder’s claim is really worth.

Sometimes, insurance companies will bring in “experts” of their own to determine the value of a claim. Unfortunately, these experts are often biased; they are paid by the insurance company and are looking for ways to justify offering you an unfair settlement or denying your claim outright.

Even in cases where your claim is not denied, your insurance company could act in bad faith by unjustly delaying payment of your claim. They may continue to ask for additional documentation, even when they don’t really need it, or find other ways to make completing the claims process as difficult for you as possible. Their hope in these cases is that you will eventually drop the claim altogether, saving the insurance company money.

This is by no means a comprehensive list of potential bad faith acts committed by an insurance company. These are just a few examples of the many ways insurance companies often commit bad faith.

Don’t Be Afraid to Question the Insurance Company’s Decisions About Your Claim

If you believe your insurance company is acting in bad faith, one of the most important steps you’ll want to take is to question the insurance company’s decision of the claim in writing.  Put your questions in writing and demand that the insurance company put its position on your claim in writing as well.  Many insurance adjusters play fast and loose with your policy language and the justification for your decision when you talk to them, but it’s a different matter when they have to reduce their decision to writing.  Remember, once an insurer puts its position in writing, if you end up having to sue the insurer for bad faith they will have a hard time changing their position.  If you don’t “get it in writing” you might be surprised how the adjuster’s version of what was said to you changes when they are under oath in a deposition or in court.

How a Bad Faith Lawyer Can Help

If you suspect your insurer is being unfair or dishonest with you (for example, about the facts of your claim, the value of your claim or the coverage under your policy) you’ll want to make sure you have the right legal team on your side. This is not something you’ll want to do on your own. By working with an experienced bad faith lawyer, you can get the legal advice and guidance you need to determine if you have a case and figure out how to proceed.     An experienced bad faith lawyer can be invaluable in deciding whether your rights have been violated and what to do about it.

Schedule your free consultation with Doug Terry Law today to receive valuable guidance and find out more about what your case may be worth. You can reach our office by calling (405) 463-6362.