Insurance exists to protect ourselves, as well as our families, homes and other property, from unforeseen circumstances. Insurers have an obligation to act in good faith when dealing with their policyholders. When an insurance company delays, denies or undervalues your claim, they may be acting in bad faith.
Should you file a bad faith insurance claim? How do you know when it is the right time to do so?
According to the California Insurance Code, the following may qualify as bad faith insurance tactics:
- Failing to acknowledge a claim in a timely manner
- Failing to settle claims with clear liability in a timely manner
- Trying to settle a claim for less than the amount requested
- Using previous claims as grounds to deny new claims
- Misrepresenting provisions in an individual's policy or key facts in a case
- Failing to conduct a full investigation of a claim
- Cancelling a policy after a claim has been filed
- Requiring excessive paperwork related to the claim
- Ignoring key pieces of information or expert opinion that would result in pay out of a claim
- Targeting high-cost claims for denials, lower pay outs or delays
- Communicating incorrectly regarding statue of limitations for claims
If you find yourself in situations relating to any of these scenarios, it may be time to consider filing a claim against your insurance company. It is never too early or too late to involve an attorney with experience handling bad faith insurance claims. These types of cases are handled on a contingency basis, so there is no initial cost to you for exploring your rights and options as a policyholder.