In California, if an insurance company is not handling your claim in good faith, what are your rights? What steps can you take? Can or should you sue the insurance company? The first step you should take is scheduling a consultation with a California bad faith insurance attorney.
We all pay a substantial amount for insurance. If you are injured by a negligent driver, or if a loved one dies accidentally, you probably expect your insurance company to approve your personal injury or accidental death claim quickly, and most insurance companies will.
The policy you hold is a promise from your insurance provider to be there with coverage when coverage is needed. When you pay for a policy, the company is legally obligated to provide coverage. It is also obligated to negotiate with you and resolve in good faith any claim you make.
Don’t allow your insurance company to take advantage of you or to operate in bad faith when it handles your claim. By law, an insurance company cannot avoid its obligation to make a payout on your claim or to offer a sound and legitimate reason for denying the claim.
How Is Bad Faith Defined?
If your insurance company does not take its legal obligation to you seriously, you could have sufficient grounds for a lawsuit alleging insurance bad faith. A simple denial of your claim is not enough. A bad faith lawsuit must be based on an insurance company’s specific acts or failures.
In California, if an insurance provider does not meet its responsibility to you, discuss your case promptly with a California bad faith insurance lawyer. Below are listed some – but not all – of the reasons why an insurance company may be targeted with a lawsuit that claims bad faith:
- failure to investigate or negotiate your claim in good faith
- failure to share with you important information
- failure to provide an explanation for a claim’s denial
- failure to pay off a claim without even investigating it
- failure to offer a reasonable settlement in a case where the liability is obvious
- failure to act on a claim within a reasonable time-frame
- offering a settlement amount that’s far less than the value of your claim
Bad faith insurance practices include prolonging a claim investigation needlessly, coercing or intimidating you into taking an insufficient payout amount, or rejecting your claim for a fabricated or disingenuous reason.
Will a Letter to the Insurance Company Help?
A straightforward disagreement over your claim’s value doesn’t mean that you are dealing with bad faith, but if you’re offered an unreasonably low settlement amount with no explanation, or if you’ve been deceived by the company, you’re probably a victim of bad faith insurance practices.
Sending the insurance company a letter – or asking your attorney to send a letter – might be enough to generate some action from the company. When an insurance company knows that you have taken the matter to an attorney, the company is more likely to begin treating you right.
The potential for legal action may compel an insurance company to make a settlement offer that’s reasonable, because if you prevail in court with a bad faith claim, the company may have to pay your attorney’s fees and additional damages over and above the original claim amount.
How Can You Help Your Bad Faith Case?
If your case goes to court, you and your insurance attorney will have to offer specific instances of an insurance company’s bad faith. You can help your case by making copies of the pertinent insurance documents and copies of any letters or emails to or from the insurance company.
Also, be sure to maintain a record of any conversations with the company. Take notes that include the time, date, and the name and job title of the individual who spoke with you.
If your case goes to court, you and your insurance attorney will have to prove that by denying your claim, the insurance company was not merely making an honest mistake but was negligent or was intentionally acting in bad faith.
How Will Your Attorney Prove Your Bad Faith Claim?
A California bad faith insurance attorney may ask your insurance company for the documents and records related to your claim and for other documents detailing the company’s procedures and policies.
The insurance adjuster or another representative of the company may be subpoenaed for a deposition or to testify in a court hearing. In certain cases, an insurance claims attorney may ask an insurance expert to make a statement or testify about insurance industry practices.
If the company did not comply with its own practices, procedures, and guidelines, and if your insurance claims lawyer can prove it, your bad faith insurance lawsuit will probably prevail.
When Should You Speak to an Insurance Claims Attorney?
If you’re not sure, how can you find out if you are dealing with bad faith insurance practices? You should send a complaint to the California Department of Insurance, which can impose both administrative penalties and in some cases bring criminal charges against insurance companies.
But you must consult a California bad faith insurance lawyer to know if you have sufficient grounds for a bad faith lawsuit and to know if the denial of your claim can be overturned. Schedule a consultation as soon as you suspect that you are dealing with insurance bad faith.
As mentioned above, in the State of California, a plaintiff who succeeds with a bad faith lawsuit may recover attorney fees in addition to a judgment that orders the insurance company to pay the original claim. Your first consultation with an attorney is free and entails no obligation.
Don’t Be a Victim Twice
If you’ve made a claim against an insurance policy, you may be at a difficult point in your life. You may have lost a loved one accidentally, or you may have sustained a severe personal injury. You should not have to be victimized a second time by an insurance company’s bad faith.
As a policyholder, you have the right to be dealt with in good faith by your insurance company. Most California insurance companies will do that, but if you aren’t being dealt with in good faith, speak about your legal rights and options with an insurance attorney as soon as possible.