Signs of Insurance Bad Faith

Signs of Insurance Bad Faith

When accidents happen, most Americans rely on insurance to bounce back. Insurance is supposed to be an agreement that paying your monthly premiums will protect you from certain kinds of damage. Unfortunately, some insurance companies refuse to honor their contracts. In American law, this is known as insurance bad faith.

What is Insurance Bad Faith?

The law requires that insurance companies provide coverage for policyholders whose situations meet the terms of their agreement. Policyholders depend on their insurance companies to offer the payouts needed to return to normalcy.

An insurance company acts in good faith when they honor their policies in a timely manner. A company acts in insurance bad faith when they delay payouts or twist the language to argue that the claim does not meet policy. In some cases, the insurance company may cut off all communication with the policyholder, trapping them in an endless cycle of phone-menus.

Insurance bad faith can come from either the larger company or individual insurance agents. An insurance agent may act in bad faith if they refuse to investigate a claim, make an unreasonable interpretation of policy, or offers an unfair settlement.

Signs of Insurance Bad Faith

Insurance bad faith can happen at any stage of the claims process. It can even happen after the insurance company has accepted the claim, but before they’ve sent payment. Anyone concerned about insurance bad faith should look for these signs and consult an attorney if they feel something is wrong.

Lack of Investigation

Insurance claims need to be investigated to estimate the damage and appraise the value. If the insurance company does not send someone to investigate after several phone calls, they may be acting in insurance bad faith.

Frequent Rescheduling

One of the most common signs of insurance bad faith is if an insurance agent regularly reschedules meetings, pushing dates out months at a time. Additionally, if they or their company stop answering calls and emails or endlessly redirect callers through the phone lines, policyholders should speak to an attorney as soon as possible.

Misinterpreting Policy

Legal documents can be challenging to understand. They can feel written to confuse. An insurance agent acting in insurance bad faith will take full advantage of this. A typical example of insurance bad faith is when an insurance agent seems to twist the terms of the policy and argue that a clear case of damages isn’t covered. Policyholders met with this kind of resistance should let their lawyer handle the legalese.

Delay in Payouts

If several months go by without payment from the insurance company, it could mean they never processed the payment or even that they have no intention of doing so. If coverage never comes, policyholders may wish to speak with an attorney.

Punitive Damages from Insurance Bad Faith

Many policyholders experience depression and anxiety when they lose their vehicles or even their homes and have no means of replacing them. Thankfully, some cases of insurance bad faith are eligible for punitive damages, also known as emotional damages.

These claims may take years to settle, but they can result in significantly higher insurance payouts that can help distressed policyholders replace lost property and recover from the emotional trauma of insurance bad faith. That said, pursuing claims of insurance bad faith and punitive damages will likely require strong legal representation.

How an Attorney Can Help

Nobody should go against billion-dollar insurance companies or their lawyers alone. Insurance policies are written by skilled attorneys.

Fully understanding the terms of the agreement often requires having someone versed in the language of the law. For that reason, anyone who believes themselves a victim of insurance bad faith should consult an attorney as soon as possible to determine whether they have a case.

An attorney can help alleviate the emotional trauma of insurance bad faith and help policyholders recover the settlements they deserve. Moreover, an attorney eliminates the stress of dealing with insurance companies as they handle all the negotiations and paperwork while victims recover and return to normal.

If you believe your insurance company is acting in bad faith, we can help. If you’d like an experienced St. Francis insurance claim attorney from Easley & Houseal, PLLC to evaluate your case, please send us an email or call (870) 330-0015.

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