Bad Faith Insurance Cases
Unfortunately, insurance companies can attempt to take advantage of policy holders and not investigate claims or pay out money rightfully owed. In certain circumstances, insurance companies might delay or even deny claims without offering any sort of reason for the denial. This is called “bad faith.” There are two types of bad faith claims. A first-party insurance bad faith claim is when an insurance company unreasonably refuses to pay a claim or properly investigate a claim for a policy holder. A third-party insurance bad faith claim is when an insurance company fails to defend, indemnify, or settle a claim within policy limits or investigate a claim brought by a third party against an insured.
Insurance companies are required to recognize your claim, investigate your claim in a prompt manner, respond quickly to communications, not purposefully slow down the process with unnecessary forms, and provide reasons for denials of claims or delays. Insurance companies must act in good faith and engage in fair deals with their insured. This good faith duty applies to all manner of insurance coverage. Whether your claim is an automobile, building, content, life insurance or disability claim, these laws apply. Access to Florida’s lucrative insurance market is a privilege and companies that receive a license to write policies understand that the Florida Office of Insurance Regulation will protect consumers who are being treated unfairly by an insurance company.
In Florida, depending on the nature of the claim, parties can choose between common law or statutory law remedies.
Florida Statute section 624.155(1) states:
(1) Any person may bring a civil action against an insurer when such person is damaged . . .
(b) By the commission of any of the following acts by the insurer:
1. Not attempting in good faith to settle claims when, under all the circumstances, it could have and should have done so, had it acted fairly and honestly towards its insured and with due regard for her or his interests . . .
In addition to the above action, Florida’s Unfair Insurance Trade Practices Act, provides any of the following would also be considered bad faith on the part of the insurance company:
- Attempting to settle claims on the basis of an application that is altered without notice to the insured;
- Material misrepresentations made to an insured with the intent of effectuating a settlement on less favorable terms than provided for in the policy; and
- As a general business practice, doing any of the following:
- Failing to properly investigate claims;
- Misrepresenting pertinent facts or provisions of an insurance policy;
- Failing to clearly explain the nature of requested information and the reason why this information is important;
- Failing to promptly notify the insured about additional information that is necessary for the processing of a claim;
- Failing to offer a reasonable explanation regarding the denial of a claim or the offer of a compromise settlement;
- Failing to affirm or deny full or partial coverage of claims upon the written request of the insured within 30 days after proof-of-loss statements are completed.
Consumers are required to file written notice of an alleged violation before a lawsuit may be filed. Insurance companies have 60 days to cure an alleged bad faith violation before any further action may be taken.
Wittmer & Linehan PLLC are experienced in negotiating and litigating against insurance companies. Our team of knowledgeable attorneys understand the complex laws that govern the relationship between you and your insurance company. Please contact us to discuss your insurance dispute and protect your right to the full benefit of coverage under your policy.