Countless Americans rely on insurance coverage of many types to be there for them when and if disaster or tragedy strikes. Insurance is supposed to provide coverage for unexpected events such as medical issues, the death of a loved one, a work accident, a destructive fire, a hurricane, or a motor vehicle accident. In short, insurance is supposed to provide “peace of mind.”
An insurance policy is a contract between the insurance company and the policyholder or insured. Just like any other type of contract, both parties have rights and responsibilities. Insureds must pay their premiums and notify the insurer promptly of claims. If the insured fails to uphold certain responsibilities, the insurance company may be able to cancel their coverage or deny an otherwise valid claim.
Insurance companies must promptly process, thoroughly investigate, and timely and fairly pay appropriate claims. When an insurance company refuses to honor its promises and obligations, who holds them accountable? Insureds and claimants can, with the help of a seasoned Biloxibad faith insurance lawyer.
What is Insurance Bad Faith?
Federal and state statutes, as well as the “common law,” govern the actions of insurance companies.No insurance carrier is above the law, and by law, each insurance company must treat its insureds and claimants with good faith and fair dealing. For instance, insurance law covers:
- What types of information insurers can request from their insured or the claimant
- The timeframe in which insurance companies must respond to and pay an asserted claim
- Reasons why an insurance company can, and cannot, deny a claim
- How insurance companies must adhere to their contracts
- How appeals and disputes must be managed
These types of laws give innocent consumers rights and help protect them against insurance companies that can be unethical and greedy. In Mississippi, insurance companies who breach their duties or act in bad faith may in some instances be required to pay “punitive damages,” which is money over and above the amount of the owed claim that is intended to punish the insurance company and to set an example to deter that company and other insurance companies from engaging in similar misconduct in the future. Insurance companies who fail to keep their promises may also be required to pay an insured’s attorneys’ fees for filing suit to enforce their claim, and to compensate insureds for emotional distress caused by the insurance company’s refusal to comply with its duties under the insurance contract and Mississippi law.
To avoid acting in bad faith, insurance companies must do things that include:
- Communicate promptly with the claimant throughout the claim’s duration
- Defend their insured party if another party pursues a claim against them that may fall within the coverage provisions of the insured’s liability policy
- Acknowledge the receipt of a claim, investigate the claim, and approve or deny it within a reasonable amount of time
- Settle claims promptly, fairly, and reasonably
- Give detailed reasons for denying claims
Types Bad Faith Insurance Actions
Under the law, all insurance carriers have an “implied covenant of good faith and fair dealing.” The law holds insurance carriers to high standards because an act of bad faith on their part could potentially bring a single one of their policyholders, claimants, or beneficiaries to economic ruin. It’s inevitable that if insurance companies pit themselves against consumers, an unfair fight will likely result.
Suppose an insurance company doesn’t handle a claim fairly, promptly, or otherwise acts fails to keep its promises or comply with the law. In such a case, insureds have a right to hire an experienced Biloxi bad faith insurance attorney and file a bad faith insurance lawsuit. Bad faith insurance cases occur frequently and in any of the following areas of insurance:
- Life Insurance: When a loved one passes, the last thing family members or dear friends want to deal with is fighting with an insurance company. Insurance Companies know this, and often deny rightful claims by referring to policy language that no ordinary person can easily understand. Often, grieving loved ones assume the insurance company must be justified in its position, and abandon their claim. Any time a life insurance claim is denied, it is a good idea to consult an experienced insurance bad faith attorney to find out if the insurance company really has a legal basis to deny the claim.
- Homeowners insurance: Ask any homeowner, and he or she will say their home is an investment. It is, after all, where the heart is. If a home is ruined or severely damaged, it could leave the homeowner in a financial calamity, and an emotional wreck. Unfortunately, it is not uncommon for homeowners’ insurance carriers to deny claims by falsely asserting that a covered incident, such as a hurricane or tornado did not cause the damage claimed by a homeowner. Other times, insurance companies wrongfully assert that vague and unintelligible exclusions prevent them from paying a claim. Consulting an experienced bad faith insurance attorney can help ensure that homeowners get the full benefit of their bargain with an insurance company they paid premiums to for months or years.
- Fire Claims: Insurance companies often deny fire claims wrongfully. In many cases, insurance companies will claim there is evidence the fire was intentionally set, even though there is no evidence the fire was set by or on behalf of the insured. Even though they know they can’t prove a valid exclusion, insurance companies will often require the emotionally agonized insured to go through months of “investigation,” and will make the demands on the insured so onerous that the insured finally just gives up – potentially giving the insurance company an opportunity to deny an otherwise valid claim for alleged “failure to cooperate.” Hiring an experienced bad faith insurance attorney can help ensure a fire insurance company is not allowed to get away with these tricks and is required to pay full benefits for valid claims.
- Disability Insurance: Millions of workers rely on disability insurance to pay their wages if they can’t return to the same or similar job position after suffering an illness or injury. Insurance companies often look for practically any reason to deny disability claims, which can in many cases cost insurance companies hundreds of thousands of dollars. Seeking legal counsel can help ensure one’s rights are protected when they need help the most.
- Long-term care insurance: Even though this type of insurance is a newer type, insurers aren’t lacking in bad faith tricks used to deny a claim for an elderly or disabled person. Often, they claim that the insured claimant can perform some tasks of daily living and therefore don’t qualify to receive their policy benefits. However, the claimant might be capable of independently putting on their shirt or brushing their teeth, but that doesn’t mean they can live independently and take care of all of their daily needs.
The above are just some examples of insurance policies where an insurance company may deny a claim in bad faith. Unfortunately, no matter what type of insurance policy is involved, there is always a risk that the insurance company may act in bad faith. Other bad faith insurance tactics include:
- Telling the claimant, they don’t need to speak with a Biloxibad faith insurance attorney
- Refusing reasonable requests for documentation
- Offering less money than a claim is worth
- Denying a claim without giving a reason
- Making threatening statements
- Misrepresenting the law or policy language
Insurance claimants who suspect an insurance company is not keeping its promise or is not acting in good faith or dealing fairly should consult with a Biloxibad faith insurance attorney as soon as possible to ensure their rights are protected.
Do You Need a BiloxiBad Faith Insurance Lawyer? Call Van Cleave Law Today
Christopher Van Cleave has been litigating insurance bad faith cases in Mississippi and holding insurance companies fully accountable for their bad faith, for 25 years. Don’t be left wondering if the insurance company is on your side or treating you or your loved one fairly. Speak directly to an attorney instead. If you need the experience of a seasoned Biloxi bad faith insurance attorney, look no further than Van Cleave Law. Call(228)432-7826 or contact us online today to schedule a private, free consultation with Mr. Van Cleave.