It is no surprise that many insurance companies turn down certain claims for many reasons that are completely acceptable to the situation. However if you feel like your insurance company has been trying to walk away without paying your claim, underpaying your claim, or merely taking longer than usual to process your claim, you may have the right to charge them with acting in Bad Faith.
What is a bad faith claim?
First of all, it isn’t a reason to go after your insurance company just because they are paying out a smaller amount of money than you expected. Should you absolutely believe that your policy is supposed to cover more funds than you received, this is a just reason to claim that an insurance company is acting in bad faith.
Because you have entered into a contract with your insurer who is supposed to be acting in good faith, you should expect full cooperation and timely responses, as well as a clear explanation why the company is denying your claim. Anything outside of that can be regarded as bad faith. Some examples of how an insurance company can act in bad faith are:
- Intentionally stalling a claims process- either stalling payment or investigation
- Lowballing a claim payout and failing to justify why the amount is so low
- Delaying payment to the policyholder
- Denying payment or canceling a claims process without reason
How To Start the Process
When first recognizing that your insurance company may be committing bad faith practices, you want to ensure that you have kept the proper documents along the way, keeping track of every person you have spoken with either by phone or by email. This should include name, date and time. Tell your insurance company that you believe they are acting in bad faith, preferably in email format, so you can complete your paper trail should a case be necessary.
Appeal the decision your agent or adjuster made, asking to have a supervisor to look at your case. If this situation is still providing you with no resolution, try to take the appeal even higher than your insurance agency. Oftentimes, your state will have an insurance regulatory agency which you can bring an appeal to, however most times these offices are overwhelmed and you may just be recommended to hire an attorney.
Should all of these outlets bring you no response from your insurance company, it is time for you to start gathering information to create a case. Write a formal complaint against the insurance agency, listing the items that you believe to be in bad faith, and be sure to include that you will begin legal proceedings against the agency.
This document may help your case, prompting your insurance company to reconsider your case. If it doesn’t however, you still have the document ready for an attorney to look over, along with any other important documents. And even if an insurance company decides to pay the claim down the line, you are still eligible to hold them responsible for bad faith practices.
If you are needing help fighting your insurance company due to bad faith acts, contact us today at (713) 864-3000!
