{"id":358068,"date":"2017-01-11T14:04:49","date_gmt":"2017-01-11T19:04:49","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/hirealawyer\/choosing-the-right-lawyer\/what-is-bad-faith-insurance-law.html"},"modified":"2024-04-09T14:25:55","modified_gmt":"2024-04-09T19:25:55","slug":"what-is-bad-faith-insurance-law","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/hirealawyer\/choosing-the-right-lawyer\/what-is-bad-faith-insurance-law.html","title":{"rendered":"Bad Faith in Insurance: What Policyholders Should Know"},"content":{"rendered":"\n
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Bad Faith in Insurance: What Policyholders Should Know<\/h1>\n\n
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\n By Susan Buckner, J.D.<\/a> | Legally reviewed by Melissa Bender, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

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Key Takeaways<\/h2>\n

Bad faith insurance law protects policyholders when an insurance company unreasonably delays, denies, or mishandles a valid claim. Insurers have legal duties\u2014such as investigating claims, paying covered losses, and defending policyholders\u2014and violating those duties may amount to bad faith.<\/p>\n\n <\/div>\n <\/div>\n<\/div>\n\n\n

When this happens, policyholders can pursue legal action to recover unpaid benefits and, in some states, additional damages. But at best, this process can drag out for weeks or months while you wait for a reasonable settlement offer<\/a>.<\/p>\n

Businesses and individuals rely on insurance companies to pay claims without arguments. If the adjuster has questions, they should ask them promptly and investigate thoroughly. We expect insurance companies to act in good faith. If our insurance company acts unreasonably or fails to investigate a claim, it acts in bad faith.<\/p>\n

This article explains what a bad faith insurance claim is. It also discusses your legal options and how a bad faith attorney<\/a> can help.<\/p>\n

What Are Bad Faith Insurance Practices?<\/h2>\n

Insurance companies have legal duties to their policyholders. Failing to perform these duties may amount to\u00a0bad faith. Your insurance policy should explain the duties your insurance adjuster<\/a> will perform and what to expect during the claims process.<\/p>\n

Significant duties<\/a>\u00a0include:<\/p>\n