When your insurance company fails to uphold their responsibilities to you under your contract, then they may be acting in bad faith, and you can sue your insurance company for the money you are owed, plus penalties.
It can be difficult to prove that an insurance company was deliberately acting in bad faith when handling your claim because the complex statutes and case law are often in place to protect the company that wrote the contract rather than the policyholder. If you suspect your claim is being mishandled or you have not been treated fairly, contact our firm today and we’ll explain exactly what you may be owed from your insurance company when filing a claim, and what your options are moving forward to get the compensation you are allowed.
What Are My Rights when My Insurance Acts in Bad Faith?
Your insurance policy is a contract between you and the insurance company. You agree to pay a premium to the insurance company every month, and they agree to pay up to the policy amount you purchased when you need to make a claim and meet the terms of what is covered under the policy. If they don’t uphold their end of the bargain, then you are well within your rights to sue to get the money you are owed from them. State laws also provide penalties, including awards for attorney fees, when the insurance company acts improperly.
What You’ll Need to Prove a Bad Faith Insurance Claim
There are generally three main things you’ll need to prove in any successful bad faith insurance claim.
- Benefits that you were owed according to your policy were not provided;
- There was no justifiable reason for why they were not provided;
- The insurance company was given a chance to fix it and refused to do so.
For example, if your insurance company denies a valid claim and refuses to explain why it was denied, that is a clear case of bad faith. But bad faith claims are often not as simple as that. First, you need to prove that your claim is valid, and that’s often an uphill battle all by itself.
What Counts as a Bad Faith Claim?
Not all bad faith claims are about insurance companies outright denying claims. For example, a bad faith claim could be made against an insurance company that demands you fill out a lot of completely unnecessary paperwork to complete your claim, or unreasonably delays denying/approving a claim or paying out on a claim. These are tactics that insurance companies use to try to wear you down and wait you out until you give up. Sometimes they just try to get away with paying less than the full value of the claim.
Another example of bad faith is when you are being sued for an auto wreck or other injury and your insurance company refuses to defend you. In most circumstances, if you are accused of being at fault for an injury, your liability insurance is required to hire a lawyer to defend you. When they refuse to do so and try to make you go it alone, they are defending their own interests and profit rather than yours.
Liability insurance is supposed to protect people from being personally responsible for paying for injuries they contributed to out of their own pockets, so when an insurance company rejects an offer to settle within the policy limits and puts their insured at risk of bankruptcy or being sent to collections, they are ignoring their responsibility under the insurance contract and acting in bad faith.
In addition to injury claims, Georgia law also allows victims of car crashes to file a bad faith claim against the at-fault party’s insurance if that insurance company refuses to pay a fair value for their vehicle or any other property the at-fault driver damaged.
All of these situations can result in a bad faith claim against the company you paid to insure you.
There’s an unfortunate amount of wiggle room on what the insurance company deems “reasonable” and what you think is reasonable. That’s where a lawyer can help. An attorney experienced with bad faith claims can help prove that the insurance company was acting unreasonably and doesn’t have justification for their demands, denials, low valuation, or delays.
Related Reading: What Does Bad Faith Mean in Insurance Claims?
The Four Steps to Filing a Bad Faith Insurance Claim
- Review your insurance contract. Since you know that you will need to prove that you have a valid claim, make sure to note all exclusions, deadlines, and so on that are listed, so you can prove that you meet the terms of what should be covered and that you followed all appropriate steps. Generally, if something is not explicitly stated as excluded, it should be included. Be careful about limits on when and where a claim can be filed, too. Some insurance companies require notice ASAP and suit in one year or less.
- Gather evidence. This includes all evidence of loss, estimates for repair or replacement of personal property (especially evidence showing that what the insurance company offered for repair or replacement wasn’t accurate to the value of the property), bills for medical treatment under a medical payment contract, correspondence with insurance company reps, and logs of when you spoke with the insurance company, who specifically you spoke to, and what was discussed. Get everything in writing.
- Appeal the denial. If your claim is denied, ask that a supervisor re-review the claim. Send your demand IN WRITING, request a reply IN WRITING (for documentation purposes), and make it clear you intend to file a lawsuit if you don’t receive either a reversal of the denial or a reasonable and justifiable explanation for why your claim was denied (your bad faith claim could be thrown out if the insurance company isn’t given a reasonable chance to fulfill your claim first before you go straight to a lawsuit).
- Call a lawyer before too much time goes by. The Law Offices of Gary Bruce have a deep understanding of bad faith lawsuits and what it takes to win one. Consulting one of our lawyers costs you nothing, and there is no obligation to hire after simply speaking with an attorney about your case. Plus, there may be deadlines to submit a lawsuit, depending on what type of bad faith the insurance company displayed.
What You’re Owed in a Bad Faith Claim
When insurance companies are found guilty of acting in bad faith, they are usually punished by being forced to pay you both what they should have given you in the first place, plus potentially thousands of dollars in penalties to compensate you for the inconvenience they caused you, and even attorney fees. They may also be required to pay you punitive damages.
However, each judgement is different, and speaking to a lawyer could help you get a better idea of what you may be owed.
Related Reading: How Do I Know If a Settlement Offer Is Enough?
We Don’t Let Insurance Companies Jerk Victims Around
Just about every insurance company out there likes to portray themselves as reliable friends to their policyholders, but whenever it’s time for them to put their money where their mouth is, well…they’d rather keep the money.
When you’re making a claim against an auto insurer after a wreck, usually bad faith claims can only be made against your own carrier. But when you have a valid claim, they CANNOT legally refuse to pay it. Call our Columbus, GA bad faith insurance attorneys today; we can help you prove your claim is valid and get you the money you are rightfully owed. Our firm is based in Columbus, and serves clients throughout Georgia and Alabama.
