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Insurance companies are required by law to act in good faith when communicating with policyholders and third-party claimants while investigating personal injury claims and negotiating settlements. The term “good faith” is used to describe fair and honest dealings, which ideally prevents insurance companies and their representatives from participating in shady or unfair dealings or blatantly committing fraud.

Unfortunately, having these good faith policies in place still doesn’t prevent all insurance companies from acting in bad faith towards its clients. On the rare occasion that this happens, the insurance policy holder has the right to file a lawsuit against the insurance company. This type of lawsuit is different than a personal injury lawsuit, and is filed separately than any open cases you have against a third party responsible for an injury-causing accident.

Special skills and training are required for filing a bad faith lawsuit against an insurance company. This is why you should always seek the assistance of a qualified lawyer who has a thorough knowledge of your state’s laws and navigating your state’s legal system.

What Are Common Bad Faith Tactics?

The common law elements of a bad faith differ from state to state. Some states have a narrower view on what qualifies as “bad faith” than others. In general, there are many types of unfair tactics an insurance company may employ that may qualify as bad faith. Some examples include:

  • Denying payment for a valid claim for no reason
  • Discounting payment for a valid claim for no reason
  • Delaying payment for a valid claim for no reason
  • Making a settlement offer that is unreasonably low/not supported by the records on file
  • Failing to approve or deny coverage claims within a reasonable time frame
  • Behaving in a rude, threatening, abusive, or intimidating matter
  • Ignoring telephone calls, letters, and emails regarding a valid claim
  • Making unreasonable or overly burdensome demands for documentation to support a valid claim
  • Refusing to explain a settlement offer or justify a claim denial
  • Failing to conduct a proper, thorough investigation into a valid claim within a timely matter
  • Misrepresenting the law
  • Misrepresenting policy language

It’s important to keep these tactics in mind when dealing with your insurance company’s claims adjuster. Having a clear understanding of bad faith tactics can come in handy if you end up having to deal with such tactics.

Dealing with Bad Faith Insurance Tactics

When dealing with your insurance company’s claims adjuster, the best way to handle bad faith tactics is keeping careful documentation of all your interactions. Keep a file of all your interactions you have with the insurance company. If you feel that the claims adjuster has acted in bad faith, make an written record of the incident and date it for future reference. Consider asking the claims adjuster to provide written documentation explaining their actions; if they refuse to do so, you should contact the insurance company to inform them that you believe the claims adjuster has acted in bad faith.

In depth documentation can come in handy should you file a report with your state’s insurance board or, if worse comes to worse, you decide to pursue legal action.

Our skilled attorneys can help you if you’re dealing with your insurance company acting in bad faith. Contact us today for a free consultation.

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