What Is Bad Faith?
Under Federal law, all people owe a basic duty of care to others. This duty of care extends to businesses and business owners as well. Insurance companies are not exempt from this basic duty of care. Insurance companies are required by law to operate in good faith with every policyholder. This means, a policyholder should not have to worry that their insurance company is taking advantage of them when they’re not looking. This is considered bad faith.
“Bad faith” is a term that generally describes dishonest dealing in any capacity. Depending on the exact setting, bad faith may mean a dishonest belief or purpose, untrustworthy performance of duties, neglect of fair dealing standards, or a fraudulent intent. All insurance contracts and documents should imply a duty of good faith and fair dealing between both the insurance company and the policyholder. When this is breached, policyholders have the right to take action.
What Are Examples Of Bad Faith Insurance Dealing?
Insurance companies have a bad reputation for being focused solely on their profits, and not giving policyholders the money they deserve when they need it most. Because insurance companies must meet their bottom line, bad faith claims are somewhat common. Many insurance companies will deny a claim immediately, in hopes that a policyholder will give up and accept defeat. In other cases, an insurance company will treat a policyholder unfairly, take far too long paying out a claim, or worse – wrongfully deny a claim altogether.
Consult with an attorney if your insurer:
- Improperly investigated an insurance claim
- Made a lowball offer
- Was dishonest or fraudulent
- Changed your policy without telling you
- Denied your claim without any explanation
- Ignored your attempts to communicate
- Refused to accept you supporting documentation
- Charged an unfairly high premium
- Wrongfully cancelled your policy
- DIdn’t advise you of a lapse in your coverage
Is A Denied Claim Always Bad Faith?
When an insurance company denies a claim, this doesn’t always constitute bad faith. There are a handful of reasons why an insurance claim could be rightfully denied. However, if your claim has been denied and you feel that it should have been accepted instead, you have every right to contact a bad faith insurance lawyer with any questions you may have.
Insurance claims can be denied for legitimate reasons, such as when a policyholder seeks compensation for damages that are not included under their policy. Insurance claims can also be denied if the claim does not contain sufficient information to back up the claim, proving why the policyholder requires compensation. This situation can be fixed with the help of a lawyer.
Sometimes, insurance companies do make mistakes. Sometimes insurance adjusters calculate a different amount of damages than the policyholder calculates, leading to a discrepancy. This is not necessarily bad faith, but doesn constitute a mistake that needs to be addressed. If you are unsure if your denied claim is bad faith or not, speak to a lawyer as soon as you possibly can.
How Can I Fight A Bad Faith Insurer?
Sadly, it’s not rare for an insurance company to act in bad faith- but fighting back is possible. If you have any inclination that your insurance company has been acting in bad faith, contact the McKennon Law Group as possible.
If applicable to your situation, our lawyers will help you hold the insurance company accountable by filing a lawsuit against them for acting in bad faith. Before filing a lawsuit, your lawyer will likely advise you to work with your insurance company as best as you can. One of the best ways to fight back against a bad faith insurer is to keep all documents, records and emails that demonstrate evidence of your loss. If you can provide this to the insurance company, they are required to adjust their actions accordingly. If they refuse, contact a lawyer.
Schedule A Free Consultation With McKennon Law Group Today
With over 70 years of experience, the McKennon Law Group has specialized in long-term disability and short-term disability insurance, life insurance, health insurance, accidental death insurance, and long-term care claims, as well as all types of ERISA litigation claims involving employee benefits, including group insurance claims, pension claims and severance claims.
Your initial consultation with our law firm is free of charge. Additionally, most of our cases are taken on a contingency fee basis, which means that you pay nothing unless we successfully resolve your case by way of judgment, reinstatement of benefits or settlement.
If you need to fight back against a bad faith insurance company, schedule your free consultation with McKennon Law Group as soon as possible.