Recognizing and Dealing With Bad Faith Claims by Insurance Companies

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When you have been injured in an accident, there are some obvious things that you may consider doing first – seeking medical treatment, calling your attorney, and so much more. One of these things is filing an insurance claim with the insurance company that is responsible for handling your claim. An insurance company is legally obligated to act in good faith, which means to investigate the claim to the best of their ability and offer you payment for your injuries. If they refuse to do this, then they are acting in what is referred to as “bad faith.”

Some of the reasons why insurance companies get sued for bad faith include unwarranted denial of coverage, failure to conduct reasonable investigations, failure to deny claims within a certain amount of time, offering less money to settle the true claim value, and failure to disclose policy limits.

Examples of Bad Faith Insurance Settlements

In one case known as Boicourt v. Amex Assurance Co., a boy was seriously injured. In bad faith, the insurance carrier had refused to disclose policy limits of $100,000. In the end, the stipulated judgement against the insureds was close to $3,000,000, forcing them to file a bad faith lawsuit against the insurer.

In another case known as Matson Terminals v. Home Insurance Co., a home insurance company denied coverage for an earthquake claim. Based on their policy exclusion, they were found to be acting in bad faith. Jury verdict for Plaintiff was in the amount of $23.58 million settled after it was affirmed on appeal for $33.65 million.

What You Can Do

Of course, any injury case will have a better chance to succeed with the help of an attorney. If you and your attorney believe that a company is acting in bad faith, you should have a conversation with the adjuster about this. Putting your accusation in writing can grab the attention of the adjuster and show them that you are being very realistic about this decision. The adjuster may feel provoked to change their settlement and position to help you settle for your injuries.

Because it is sometimes difficult to win bad faith damages in court, you will need an attorney on your side throughout the tedious process. Receiving compensation is only possible when you have proper evidence and are aware of the laws governing your accident and claim. Call us today for more information on how we can help.


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