Insurance Bad Faith

When a person takes out an insurance policy from an insurance company, he enters into a binding contract with it, and as such their relationship is governed by the terms and conditions set forth in the policy. In the event of a valid claim, and the insurance company refuses to pay, a breach of contract is committed by the insurance company, and the aggrieved party can seek legal remedies.

The law is clear that all insurance companies are required to act in "good faith"; when it issues an insurance policy to undertake payment of a loss; it is bound by law to honor its obligations, provided however that a claim for insurance has been proven valid.

This is the compelling duty of insurance companies that the law has prescribed when it gives them the right to operate. Insurance companies acting on bad faith have marred the reputation of the insurance industry; every state in the US has its specific insurance laws that guarantee the insured protection against fraudulent acts by insurance companies. It is therefore indispensable for a party claiming insurance to hire the services of a competent Florida accident lawyer to address any or all of the following legal issues pertaining to insurance claims.

When there is ambiguity in the interpretation of the insurance policy

When there is ambiguous interpretation of the insurance policy due to its language, the law decides in favor of the insured.

When is there bad faith on the part of the insurance company

An insurance company has the presumption of law to always act in good faith when dealing with its clients. Any deviation from this obligation is tantamount to bad faith, and the insured may seek legal remedy to recover damages. However, the insured needs the services of a competent lawyer who should have a proven track record in handling insurance claims, since bad faith is not easy to prove.

There is bad faith when the insurance company refuses to settle an obligation within the limits of the insurance policy of the insured, before action for damages is filed in court. In the event that the insured is charged by the court to award damages to an injured party, in excess of the limits of his insurance policy, the insurance company can be held liable for the excess. When this happens, the insured may seek court intervention to compel the insurance company to answer for the total obligation. Its failure to do so may constitute bad faith.

There is also bad faith when the insurance company settles its obligation with the insured at an amount lower than what is reasonable and just, as prescribed for by law.

What to do to protect your interest against bad faith by your insurance company

Consult a lawyer. A competent lawyer can represent you efficiently in all legal issues pertaining to insurance claims. Without a lawyer's expert advice, you may not succeed in receiving full and just compensation from your insurance company. To choose a lawyer, you should consider his line of expertise:

1. Personal Injury Attorney - when you have been injured by a third party;
2. Worker's Compensation Attorney - when you are injured while in the performance of your job;
3. Disability Attorney - when filing for benefit claims with Medicare and other related programs;
4. Medical Malpractice Attorney - when you have suffered harm or injury due to negligence committed by a health professional;
5. Lawyer dealing with bad faith issues - when you have filed a claim to your insurance company and it was either turned down or settled less than what is your just and reasonable compensation, as provided for by the provisions of your insurance policy.

Let your lawyer do the "talking". It would be safe not to divulge any information regarding extent of your injuries when you are the one injured, or the circumstances surrounding your accident to your insurance company, without consulting your Florida accident attorney first. Any information you let out, without the consent of your lawyer may jeopardize your chance to full recovery.

In case of refusal by your insurance company to honor the claim you have submitted, you may take the necessary steps to file an appeal in court, based on the appeals process provided for in your policy. Make sure you have your insurance company's denial of your claim, in writing.