Insurance companies have a legal obligation to act in “good faith” to investigate, negotiate and settle claims filed by policy holders within a timely manner. If your insurance provider fails to uphold its end of the contract and wrongfully denies, delays or minimizes a valid claim, it may be acting in “bad faith” and can be held liable for its actions.
There are a number of practices that insurance companies often utilize that could be considered bad faith. Some examples can include:
Failing to conduct an investigation into a claim – Insurance companies are required to conduct a prompt and thorough investigation into a claim filed by a policy holder. If the company fails to conduct an investigation, delays an investigation or conducts a poor investigation into your claim, you may have grounds for a bad faith insurance claim.
Denying a claim without a valid reason – If an insurance company does not provide a reason for denying your claim, or if it gives an invalid reason for the denial, it may have acted in bad faith.
Delaying payment – Because policy holders rely on insurance payments after an accident, providers are required to pay a valid claim within a reasonable amount of time. If they unreasonably delay your payment, you may have a claim against them.
Offering less than the value of a claim – Insurance companies will often offer a lowball settlement immediately after an accident. If they refuse to budge from that low settlement offer or continue to offer significantly less than your claim is worth, they may have acted in bad faith.
Refusing to pay a valid claim – If an insurance company refuses to offer a settlement for a claim that is valid and covered by your policy, it may be acting in bad faith.
Misrepresenting policy language – If an insurance company is untruthful and intentionally misrepresents the law or the language of your policy, it may be acting in bad faith.
If you believe that your claim has been mishandled by your insurance company, it is in your best interest to contact an experienced insurance lawyer. We can help you determine if the provider has acted in bad faith and if you have a case against the company.