At its most simple, insurance bad faith occurs when the insurance company breaks an agreed upon promise. The law requires insurance companies to act in good faith and fair dealing with the person or company they insure (insurance policyholder). If the insurance company fails to act in such a way the policyholder may be able to file a few different types of claims against the insurance company in order to force them to act and/or pay damages for their bad faith actions.
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Some common forms of insurance bad faith are:
There are two ways that bad faith insurance claims are carried out.
In this case the insured has made a direct claim to the insurance company. The company then refuses to pay, delays payment or only partially pays the claim.
An example of this type of insurance bad faith would be if a person were involved in a car accident, made a claim against their insurance to get their vehicle repaired or their medical bills paid and the insurance company refused the claim.
This form of insurance bad faith takes place when a person or company has been sued and the suit is covered under an insurance policy that the company or person has. If the company/person loses the suit and the settlement amount is within the policy limits, and the insurance company refuses to pay.
An example of this type of insurance bad faith might be if a person went to a carnival and was injured by one of the rides. They sue the carnival and win or settle the suit then the carnival’s insurance refuses to pay in an attempt to force the carnival pay out of its own pocket.
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Some insurers see acting in bad faith as a way to increase their bottom line. Many insurance companies receive thousands of claims every day. Of those that are denied, very few are ever challenged. By systematically denying claims the insurance company can save itself a lot of money.
Don’t allow yourself to be just another number on their bottom line. If you have been a victim of insurance bad faith an attorney can help you investigate your case and seek restitution.
If you would like to speak to one of our expert attorneys in regards to your bad faith case you can contact LA Injury Group, Inc. here using our contact form or call us toll free at 1-888-500-1006.