Do I Need a Bad Faith Insurance Lawyer?
Created by FindLaw's team of legal writers and editors | Last reviewed July 10, 2017
If you bought insurance and you’ve been paying your premiums, you expect your insurance company to come through for you if and when the need arises. But what if they don’t? What if your claim is unfairly denied, the company isn’t communicating with you, or they’re pressuring you to accept an unreasonable settlement offer? If you suspect your insurance company is not holding up its end of the bargain under your insurance policy, you may need a bad faith insurance lawyer to help protect your rights. Read on to learn more about bad faith insurance tactics and how an experienced attorney can help you.
What Is Bad Faith?
To know whether you need a bad faith insurance lawyer, you first need to understand what bad faith means in the insurance context. Every insurance company has a duty to act in good faith and treat clients fairly. This doesn’t mean that they have to pay every claim they receive. However, the insurer can’t simply look out for its own interests, searching for ways to deny claims in order to boost its own profits.
Even though each state regulates the insurance industry differently, these general obligations exist no matter where you live, and failing in these duties may constitute bad faith. Additionally, bad faith on the part of your insurer can occur no matter what type of insurance you have. If an insurance company acts in bad faith, they may face a lawsuit with expensive consequences as well as fines and other penalties from the state insurance commissioner.
Ways an Insurance Company Might Act in Bad Faith
Whether you’ve filed a claim for property damage, physical injuries, life insurance benefits, or you’re being sued for something that could be covered by your liability insurance, your insurer has specific duties it must fulfill in order to avoid acting in bad faith. Although they vary from state to state, these duties generally including the following:
- Respond to client inquiries and correspondence in a timely manner
- Conduct timely and reasonable investigations into claims
- Approve, deny, and pay claims within a reasonable or state-specific timeframe
- Provide an explanation for claim denials, citing specific policy provisions applicable to the denial
- Defend the insured in a liability action where at least one of the claims is potentially covered by the insurance policy
- Pay for damages in a liability action up to the policy limits
If your insurance company seems to be failing in any of these duties and you’ve tried working with them to come to a fair agreement, it’s probably time to contact a bad faith insurance lawyer who can handle all future correspondence with the insurance company.
How Can a Bad Faith Insurance Lawyer Help You?
Pursuing a bad faith insurance action is no small undertaking. Bad faith lawsuits take a lot of time, resources, and persistence. If you’re considering such a pursuit, there are many reasons to hire a bad faith insurance lawyer.
Insurance law is complex:
Each state has different laws. You need an attorney familiar with the laws of your jurisdiction who can tell you whether or not your insurance company’s actions amount to bad faith. Courts interpret those laws differently. An experienced attorney will know how courts have interpreted bad faith laws, and therefore have a better understanding of your likelihood for success in a lawsuit. States also vary on the types and amounts of damages allowed. A bad faith insurance lawyer will know what damages to demand at the start of the lawsuit.
The insurance company will be well-equipped to fight your lawsuit:
Insurance companies are used to fighting insurance lawsuits and will have a team of experienced lawyers. They also have a strong incentive to fight the lawsuit because their business is run on paying less in claims than they make on premium payments. In addition, they may try to pressure you into dropping your lawsuit or accepting a low-ball settlement offer.
Compensation and Attorney’s Fees
Many bad faith insurance lawyers will work on a contingency basis, and some states allow you to recover non-economic damages, attorney’s fees, and punitive damages if you win your lawsuit. These options are especially beneficial when you’re already struggling to pay the bills your insurance was supposed to cover in the first place.
Let a Bad Faith Insurance Lawyer Defend Your Rights
Whether a loved one has died, your home or car was damaged, or you’ve been injured, the insurance claim process is bad enough without having to deal with an uncooperative insurance company on top of all that. And going up against a well-equipped company for bad faith practices is probably not something you have the time, resources, or training to do on your own. If you’ve decided to pursue a bad faith lawsuit, or you’re simply considering your options, contact an experienced bad faith insurance lawyer who can advocate on your behalf and protect your interests.
You Don’t Have To Solve This on Your Own – Get a Lawyer’s Help
Meeting with a lawyer can help you understand your options and how to best protect your rights. Visit our attorney directory to find a lawyer near you who can help.