Knight armor

Bad Faith Insurance: Are You REALLY Protected When It Matters?

RRBHLAWZENblog Insurance Litigation

We’ve all seen them—advertisements that portray the insurance company as a protector. When everything goes right, this portrayal can ring true. But what about bad faith insurance practices? Your insurance provider is supposed to act as a suit of armor for your and your loved ones. You hope you won’t need it, but you pay for it anyway, just in case the worst happens. When your insurance company acts in bad faith, it’s as if you were imagining that you were wearing the armor the whole time—when that happens, you need to take action.

What Is Bad Faith Insurance?

Insurance companies—as many of their ads claim—are supposed to protect their policyholders. When an insurance company fails to do so, either intentionally or negligently, that is what is known as a bad faith insurance practice. Insurance companies have an obligation by law to act in good faith. What that means is that when you file a claim, your insurance provider shouldn’t look for ways out of investigating the claim or paying you what they owe you.

A Look at a Bad Faith Insurance Case

Way back in the 1990s, the former owner of an auto repair shop had to file a suit against his insurance company, Traveler’s Insurance. The bad faith insurance case went like this:

  • The policyholder was asked to leave the premises of his shop after his landlord died.
  • Following his removal from the property, he was sued for environmental damage.
  • Because he knew he had insurance, he asked his insurance company to provide him with a defense.
  • At first, Traveler’s denied that he had a policy. Then, after it was revealed that he did, in fact, have a policy, the insurance company denied his claim after asking for information that the policyholder could not provide.
  • The auto repair shop owner sued the insurance company for bad faith, and the jury agreed with him, awarding him $26.5 million.

This is just one example of what the results you can get when you take legal action against your insurer for bad faith practices.

What You Can Do about Bad Faith Insurance

If you think you might be the victim of bad faith practices, there are a few steps you will need to take. First, make sure to document everything that pertains to your claim. You will need evidence if it becomes necessary to file a lawsuit. Second, remain professional and courteous. You don’t want to give your insurance provider any ammunition that can affect your case. Finally, get in touch with an experienced attorney who is familiar with insurance litigation and bad faith insurance practices. Have a conversation with them about your case and ask plenty of questions.

Are you the victim of bad faith insurance practices? Contact us today to go over your case with the experience insurance litigation team at RRBH Law.