You buy an insurance policy to protect your home against disaster; you maintain a policy to rebuild your business, should a fire destroy it; you pay for a policy to cover expenses related to a serious illness. You rely on your insurance company to meet the terms of the policies you have purchased without delay, underpayment, or denial of valid claims. Unfortunately, many insurance companies are proving to be unreliable.
Most regulatory laws for the insurance industry are state-specific. However, most jurisdictions in the United States require that insurance companies operate within the “implied covenant of good faith and fair dealing.” Typically, insurance companies fall short of policyholder expectations and the terms of their policies. Insurance companies are bound to:
- Disclose the full scope and limitations of the coverage being agreed to
- Provide coverage as outlined in the policy
- Provide information, such as policy changes, in a timely manner
- Act in a position of trust, good faith, responsibility, and truthfulness on behalf of and with their policyholders
If an insurance company violates this covenant with the policyholder (denies or delays payment on a viable claim, fails to investigate a claim, or underpays a claim), they may be sued on a tort claim as well as a breach of contract claim. This important distinction comes into play because punitive damages are not awarded in contract claims; however, they are considered in tort claims. What this means for a policyholder is that they may be able to recover more than the original face value of their policy. This is particularly likely if the insurance company exhibited reprehensible behavior.
Our team of experienced attorneys will be your advocate through the complex process of pursuing a bad faith insurance claim. Despite the seemingly endless resources and powerful team of lawyers working to protect the insurance company, we will fight to protect your rights and recover your losses. We are well-versed in negotiating insurance law and know how to maneuver the tactics that insurance companies employ. You can rely on The Gooch Firm!