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The insurance industry is highly regulated, and that’s a good thing, since it doesn’t always operate like it’s required to under law—as evidenced by the many insurance bad faith claims that make their way through the courts each year. By law, insurance companies and the people that represent them—including claims adjusters and negotiators—are required to act in good faith toward not just their own policyholders, but also toward any third-party claimants against policyholders. Simply put, their dealings with the people they serve, including customers and people suing their customers, must be fair and honest. If they fall short of this standard while investigating a claim or even in negotiating a settlement for a claim, then they may find themselves on the receiving end of a lawsuit. If you believe an insurer has acted in bad faith, consult with our Tacoma insurance bad faith attorney to determine what legal remedies are available to you.

In Washington, insurers are bound by the Equal Consideration test. This means that an insurance company cannot put its own interests above the interests of the insured. If a claim is denied, there must be a valid and specific reason why.

What is a bad faith tactic?

In the broad sense of the phrase, bad faith simply means unfair or dishonest dealings. Some of the tactics used by insurance companies (usually in an effort to reduce payouts to claimants), include:

  • Denying a valid claim without a valid reason
  • Failing to deny or affirm coverage within a reasonable period of time
  • Failing to promptly investigate claims
  • Ignoring communications regarding a valid claim
  • Making an unconscionably lowball offer that doesn’t support the facts in the claim
  • Misrepresenting the language of a policy
  • Purposely misinterpreting the law to insured or claimants
  • Reducing an award without a valid reason
  • Refusing to provide an explanation for denying a claim
  • Requiring overly complicated requests for claim documentation
  • The use of rude, abuse or intimidating communications
  • Withholding payment without reason

What recourse do you have with insurance bad faith actions?

The first thing that you should do if you believe that an insurance company is not being honest and fair with you is contact an attorney. Your attorney can advise you of your legal rights as an insured or claimant and can point you toward the next steps you need to take in order to hold the insurance company accountable for their bad faith. This will likely include filing a report with the Washington State Office of the Insurance Commissioner. This will trigger an investigation, and oftentimes the insurance company will face a steep fine or other penalty as a result.

You can also file an insurance bad faith claim to recoup your own losses due to the bad faith action of the insurance company. If your insurance company fails to act in a reasonable manner in processing your claim, investigating your claim, or making payment for your claim, you have the grounds for a lawsuit. Contact our Tacoma insurance bad faith attorney to discuss the legal avenues that may apply in your situation.

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