As much as we’d like to fully trust the insurance companies we pay to protect our valuables and livelihood, they don’t all operate in an honest, diligent way.
Unfortunately, the reality is that bad faith insurance practices take place every day, and it’s a global phenomenon.
Thankfully, here in the United States, there are laws that protect consumers against insurance companies who act out of bad faith. However, it is up to the consumer to recognize bad faith insurance actions when they’re taken, and it is also up to the consumer to do something about it.
The Law Office of Matthew R. Osborne, PC specializes in representing consumers who have been treated unjustly by one or more of their insurance companies. The claim could be in relation to an auto accident, personal injury, natural disaster, or something else entirely. Whatever the case may be, it’s ‘buyer beware’ when it comes to calling out insurance companies for their bad faith practices.
When you know more about what bad faith insurance actually is, you can better decide whether or not you may have a legal case against your insurance company. In this blog post, we’re going to analyze bad faith insurance practices and explain the relationship between them and you as the consumer.
Bad Faith Insurance, Defined
When you enter into a contract with an insurance provider, you are taking part in a legally binding agreement that requires all parties to maintain accountability to the terms and conditions of the policy in question.
Typically, in exchange for insurance coverage, you pay a premium. In return, the insurance company promises to reimburse you for covered losses you incur at any time during the instatement period of your policy.
If you don’t pay your premiums, the insurance company has the right to withdraw insurance coverage.
The converse is, however, also true: if you make a valid claim against your policy and the insurance company acts out of bad faith, you have the right to pursue legal action against them.
So what exactly is bad faith insurance? It’s any action taken (or not taken) by an insurance company that unreasonably denies the insured honest, ‘good faith’ treatment. This may seem subjective, and it can be, in some cases. In other cases, bad faith insurance is blatant and can be easily proven in a court of law.
It might help to provide a few examples of bad faith insurance practices. They include:
- Unreasonably withholding benefits due on a claim. When an insurance company flatly doesn’t pay the benefits that are owed after a claim has been processed, it’s acting out of bad faith.
Reimbursing policy holders for their losses should be a fast, efficient process. When it’s not, and when insurance companies drag their feet for weeks and months on end, it’s bad faith insurance.
- Not acknowledging the claim, ignoring requests, or excessively complicating the claim process. It’s not uncommon for some insurance companies to load their claim process with mountains of paperwork and red tape, making it prohibitively difficult for consumers to navigate the claim process.
You shouldn’t need a degree in Actuarial Science to file a claim with your insurance company. If you are being ignored or burdened with an unreasonable amount of administrative tasks as part of the claim process, you could be dealing with an insurance company that is acting out of bad faith.
- Not giving a reason, or fabricating a reason, for declining a claim. If your insurance claim has been denied, the insurance company is legally required to provide you with a reason why. If they don’t, or if the reason they provide seems dubious according to the terms of the policy, it’s quite possible they could be engaged in a bad faith insurance practice.
Remember, these are just examples of some bad faith insurance practices, and there are many, many more.
What to Do If You Suspect Bad Faith Treatment
To truly know whether or not you have a bad faith case against an insurance company, you’re going to want to meet with a qualified consumer rights attorney. Until you do, the insurance company is likely to continue treating you as it already has up to this point.
The Law Office of Matthew R. Osborne, PC knows how frustrating it can be to be on the receiving end of bad faith insurance practices. Our team is passionate about empowering consumers to take legal action, wherever appropriate, to fight against insurance companies who put profits over their customers by acting out of bad faith.
To schedule a case review, contact us today.