What Does Bad Faith Insurance Practices Mean?
Insurance companies are expected to act in good faith when a person with insurance policy issues a claim. An insurance company acts in bad faith when they fail to fulfill the obligations stated in the insurance policy, or if it fails to abide by the laws created in the particular state where the claim is made.
Below are examples of bad faith insurance practices:
- Refusing to pay a claim that it owes
- Failing to pay a claim in a timely manner
- Requiring unnecessary paperwork to process your claim
- Failing to deny a claim in a timely manner
- Failing to explain the reason for a claim denial
- Failing to defend you against a claim
- Failing to conduct a complete investigation
- Misrepresenting a material fact or policy provision
- Failing to disclose the policy limitations before the purchase
What Isn’t Considered Bad Faith
Bad faith practices often hurt policyholders, especially after they have suffered injuries in a car accident. However, not all hurtful actions are caused by bad faith. For example, if the policyholder and the insurance adjuster have a different opinion on the loss after an accident, it doesn’t mean that the insurance is acting in bad faith. But, if the adjuster failed to give the policyholder details as to why the claim amount is different than what expected, bad faith practices may have occurred. It’s important to note that a mistake or error made by the insurance company doesn’t constitute a bad faith claim.
Insurer Requirements
Insurance companies are required to handle cases honestly, fairly, and in good faith so that policyholders receive the benefits of the insurance contract. Insurance companies are required to accept or deny a claim within 15 working days after receipt by the insurer. Insurance companies must also conduct investigations within 30 days after notification of the claim unless the investigation can’t be done for another reason. They also can’t try to settle claims for less than what should reasonably be provided to a policyholder.
Laws Against Bad Faith Cases
Thankfully, there are laws that protect policyholders from bad faith insurance practices. According to the Arizona Supreme Court, when an insurer fails to act in good faith, the insured is not limited to the damage provisions of a contract. These laws allow policyholders to take legal action in response to the insurance company’s mistreatment. A person can file a claim against the state insurance board. Once that happens, an investigation will begin to determine if bad faith took place in your case.
Bad Faith Insurance Claims
When insurance companies unreasonably deny claim coverage or act in bad faith, they can be held liable for their negligence. If your car accident claim has been denied or you have been offered a reduced settlement without any supporting details or explanation, you may be entitled to file a claim against them. In Arizona, bad faith insurance claims must be filed within two years after the company committed a bad faith act.
If you think you have a bad faith insurance claim, you need an experienced attorney on your side. Insurance companies typically have a large team of attorneys who are ready to protect the company’s interests. For such reasons, it’s vital to have an experienced attorney on your side who can protect your rights. Failing to hire an attorney experienced in bad faith insurance claims can hurt the outcome of your case.
An attorney can help you recover punitive damages, emotional distress, consequential damages, and attorney fees. Punitive damages are typically only awarded if the insurance company intended to harm you or if they knew that their actions could harm you. An attorney can also help you obtain the amount due under the insurance policy up to the policy limits.
Call Our Phoenix Car Accident Attorneys Today!
If you’ve been injured in a car accident and you haven’t received compensation from your insurance company due to bad faith, our Phoenix car accident lawyers are ready to help you. We have decades of combined experience helping those injured throughout Arizona obtain the compensation they deserve after being involved in a car accident. We know that every case is unique, so we take an individualized approach to creating strategic solutions for you. Our team is ready to help you from beginning to end.
What Sets Suzuki Law Offices Apart?
- We are available to answer your calls 24/7!
- Our attorneys are fluent in both Spanish and English
- We have secured millions of dollars on behalf of our clients
- We offer free initial consultations
- Our team if attorneys are rightly rated professional advocates
Call or text (602) 682-5270 or complete a Free Case Evaluation form