Bad Faith Insurance Claims: How to protect yourself from insurance companies that seek to deny or limit your policy rights? How to best pursue your rights.
Unfortunately, there are many insurance companies that practice bad faith or unfair behavior. These practices are generally evident in many aspects of their practices, but they are mostly eminent when they deny a valid claim or provide inadequate payment to a claim that should be covered by the company.
Bad faith mostly results from executives wanting to reserve funds or save money for self-interest. They are encouraged to do so since most people will give up trying to receive coverage after having their claim rejected on multiple occasions. In this case, however, the insured must take measures to protect their rights. Here’s what you need to know about bad faith insurance claims.
Considering a Claim
It is up to a judge or jury to decide whether the insurance company is acting in bad faith. Although it sometimes is very clear when an insurance company is being unfair, there are many policies or procedures that determine the level of compensation that you may be unaware of. This is why what you perceive as unfair treatment may be passed off as circumstantial to a judge. The jury will decide that the company is acting in bad faith if they review the documents and suspect reasonable doubt that the company was aware of their unfair actions.
If you file a claim, there is a set of policies that an insurance company is mandated to follow. Being aware of these policies will allow you to determine whether you have a valid claim. For instance, an insurance company is obliged to investigate your claim within an appropriate timeframe and as soon as the claim has been investigated, they should determine how much coverage you will be receiving and settle your claim smoothly. They should be prompt and clear when communicating with the insured claimants and policyholders. They should also be able to explain the specifics of the policy terms comprehensively. They are also required to either confirm or deny having your claim covered within an appropriate time period.
Having a Claim
Having a claim that you think is valid get rejected, or receiving inadequate payment coverage are not the only circumstances in which you may have an eligible claim. The lines may be blurred if a company fails to follow the obligations that were mentioned above; a judge may perceive it as a mere technical issue. However, if your insurance company fails to thoroughly investigate your claim, fails to consider the situation in light of the insured individual’s best interest, refusing to settle or defend a lawsuit are all clear signs of bad faith.
If you have reason to believe that the insurance company is acting in bad faith, the legal professionals at Kerley Schaffer LLP strongly advise you to hire a lawyer to fight for your compensation. Your lawyer can help you prove bad faith, in which case you will be able to collect reimbursement. In most cases, the amount you are entitled to is the amount that was initially allotted to you as per your policy. In some instances, however, you can receive supplementary rewards if your company’s actions resulted in sustainable damage. In drastic cases, the insurance company may end up being charged with punitive damage.
Filing a Claim
If you want to file a legal claim of bad faith against your insurance company, you must prove that the company withheld the benefits that you were entitled to under the policy. The first thing that you should do is establish the fact that your claim is valid in accordance with the terms of your policy. You should provide evidence that you had your claim rejected by the insurance company.
This process slightly differs from one state to another, however. Before filing a lawsuit, you may be required to make a final demand. You should also prove that the insurance company had no reasonable reason to deny your claim. Always keep in mind that meager negligence is not a sufficient reason to establish that an insurance company is practicing bad faith. You should work with an attorney to prove that the insurance company intentionally denied your valid claim.
Many insurance companies practice bad faith or neglect the deserved rights of an insured company. Though, not everyone has the courage to stand up to their insurance company. An insurance company will work with the best lawyers to find a way to dismiss your claim. However, with the right attorney, enough evidence, and proof that the insurance company went against the terms of your policy, you should receive proper compensation.