What are Examples of a Bad Faith Insurance Claim?

When you are in a car crash, fall down and get hurt, or are in some other kind of unfortunate accident that requires you to go to the hospital, replace your car, or otherwise spend a large amount of money on picking up the pieces, you will probably look to a relevant insurance policy to provide coverage. After all, that is the reason that insurance exists – to guard against unexpected, massive expenses. Insurance companies, however, ultimately exist to turn a profit. Therefore, there may be times when insurance providers give unfairly narrow assessments of when their coverage applies.

This is what is known as a bad faith insurance claim. If an insurance provider unfairly denies your claim, undervalues it, misrepresents obligations under your insurance policy, or right-out refuses to communicate with you, there is a good chance they are acting in bad faith. You should talk to legal counsel if you suspect that your insurance company is acting in bad faith in your situation.

Our insurance claim lawyers can provide a free analysis of your claim when you call The Carrion Law Firm at (718) 841-0083.

What is a Bad Faith Insurance Claim?

A bad faith insurance claim is when your insurance company unfairly tries to get out of paying or actively asserts that they do not need to provide coverage to you for a given situation when, in reality, they should be providing coverage. Insurance providers are not in the business of giving out money every time someone claims they are covered. If that were the case, the company would quickly run out of money and shut down. However, sometimes insurance companies take protecting their bottom line too far and deny coverage to deserving policyholders. This is what is known as a bad faith insurance claim.

Bad faith insurance claims go beyond mere differences in opinion Different states will have different laws regarding what constitutes bad faith and what methods of recourse you have, so you should talk to a lawyer to figure out how to best proceed in your situation.

Examples of Bad Faith Insurance Claims

There are a lot of different ways that a bad faith insurance claim could play out. Insurance companies can “attack” a claim from different angles. To see if you are being subjected to a bad faith insurance claim, you can have our insurance claim lawyers go over your policy to determine whether an insurance company’s grievances are legitimate or if they are acting out of line.

Not Communicating

One way that insurance companies may act in bad faith is by simply not responding to your requests or inquiries. Insurance providers are not allowed to ignore your attempts to contact them or sit on your claim and pretend it does not exist. If you are having difficulty getting a response from your insurance provider, our attorneys can communicate on your behalf in a way that will encourage them to address your claim.

Arbitrary Denial

Insurance companies cannot deny claims without a reason. If an insurance provider refuses your claim without telling you why, they are acting in bad faith.

Undervaluing Claims

Many insurance providers will “low-ball” how much coverage they believe you are entitled to for a given incident. Insurance companies do not like giving out money, so it is not unusual for there to be some back-and-forth regarding how much coverage they are to provide. However, if they take it too far, it can rise to the level of bad faith.

Documentation Demands

Insurance providers will frequently ask for documentation to support your claims. Generally, this includes things like medical records and other items that show your injuries and their cost. However, if an insurance provider asks for too many documents, asks for things that are not relevant to your claim, or keeps moving the goalpost on what you need to give to them, it can be considered acting in bad faith.

Policy Alterations

Your insurance policy should have clearly defined terms for what it covers and how much coverage it provides. That policy is what you and the insurance company agreed to when you signed off on it. An unscrupulous insurance company may alter their policy after you file a claim. That is illegal and would be considered bad faith.

Misrepresenting Policy Terms

Instead of outright altering your policy, an insurance company acting in bad faith may instead misrepresent the policy you already have. The insurance provider may try to narrowly interpret the terms of your policy so that your specific instance is not covered or, if it is, you are only eligible for a token amount of coverage. Alternatively, the insurance provider may fail to tell you about policy language that compels them to provide coverage.

Factual Misrepresentations

Insurance providers may also try to twist the events described to them so that it appears coverage may not apply. The company may downplay your injuries or make the situation seem like it was your fault when, in reality, it was not.

One way to guard against this is to have an attorney communicate with insurance companies on your behalf. That way, you can be certain that the full extent of your circumstances is explained to the company, and shady insurance companies will be less likely to try and pull one over on a legal professional.

Threats

Sometimes, insurance companies will drop all pretenses of professionalism and move directly to making threatening statements. For example, if an insurance company accuses you of attempting to commit insurance fraud when you have filed a valid claim, that would be a threat. The idea is to get you to back off so they do not have to pay you. Under no circumstances should your insurance provider be threatening you, so you should contact our lawyers immediately if that happens.

Call Our Insurance Claim Lawyers Today

For a free case analysis, call The Carrion Law Firm’s insurance claim lawyers at (718) 841-0083.