insurance bad faith

Car Accident Cases: What is Insurance Bad Faith?

Car Accident Cases: What is Insurance Bad Faith?

insurance bad faith

Car accidents are far too common, with over 5 million accidents occurring each year across the country. Accidents are so common, in fact, that there’s a good chance each one of us will be in at least one during the span of our lifetimes. If you’ve been in an accident recently, it’s important that you get the compensation that you deserve. One obstacle to getting this compensation is insurance bad faith.

What should you do if you feel like an insurance company is treating you unfairly? Read on and we’ll walk you through what you need to know.


What is Insurance Bad Faith?

When you get into an accident of any sort, you have a right to compensation if the incident was caused by another’s negligence. In some states, you may have a right to compensation even if you were at fault for the accident.

The damages and medical costs associated with an accident can be quite expensive. It’s enough to bankrupt any average American family.

It’s for this reason that all drivers have auto insurance policies. The insurance companies are the ones to step in when an accident occurs and provide the payment needed.

However, there are some instances where insurance companies may attempt to renege on the obligation they hold to their clients. When a company refuses a legitimate claim from a policyholder, that is considered a bad faith insurance move.

Anytime an insurance company acts in a manner that is against their own policies, in an attempt to avoid your proper payout, action needs to be taken.

What Does Bad Faith Insurance Look Like?

There are a number of ways in which an insurance company might fail to properly honor its own policies. A denied claim that is made on perfectly reasonable grounds is one common example.

Another example might not require outright denial, but a failure to provide the service they were being paid for. If they take too long to investigate and process a claim, leaving a policyholder on the hook, this can also be considered bad faith insurance.

Failure to disclose information that could affect a policyholder’s payout is a third way that bad faith insurance could be committed. When a person signs up to do business with an insurance company, they should be able to have a full idea of what the company is willing to provide.

If the insurance company tries to change things after an accident has occurred, it can easily be considered bad faith.

You pay your insurance company so that you can have peace of mind while you’re on the public roadways. If they fail to hold up their end of the bargain once an incident does occur, you do have a right to take legal action.

What Does Bad Faith Insurance Not Look Like?

If a policyholder and an insurance company disagree on the amount of payout required for a car accident case, this isn’t necessarily a bad faith insurance situation.

As long as the insurance company has evidence to back up its claims, they do not have to agree with the precise demands of a policyholder.

It’s only when this evidence fails to arrive that suspicion of bad faith could be on the table.

Bad faith insurance also relies on the idea of intention.

An insurance company must be intentionally acting in a way so as to avoid payment to a client. An insurance company that made a mistake and was not aware could not be sued for bad faith, for example.


Fighting Bad Faith Insurance Cases

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What can you do if you think your insurance company is in violation of insurance policy terms? You need this compensation, after all, to get your life back on track. The stakes couldn’t be higher.

The moment you begin to suspect that an insurance company is acting in bad faith, you should find the time to speak to a personal injury attorney.

Many state laws are in place across the country to protect consumers against this kind of behavior from insurance companies. An attorney should be able to look at the specifics of your case and walk you through what your next steps should be.

In many cases, you might be able to win compensatory and punitive damages from the insurance company if you can prove they were acting in bad faith. These damages could cover your attorney’s fees completely, as well as additional compensation for missed work and other such losses.

Punitive damages are not always awarded in these cases, but a jury might push for them if they believe an insurance company has acted particularly terribly towards a client.

These punitive damages are intended to punish the insurance company for its behavior. They are intended to dissuade the company from attempting this kind of bad faith action again in the future.

They are also there to ensure that you recover from this difficult time, made more difficult by the greed of a large corporate entity.


Understanding Insurance Bad Faith

If you’ve been in an auto accident of any kind, you could have serious financial costs ahead of you. In most cases, your insurance company would step in and handle these needs during this difficult time.

The above information breaks down what bad faith practices look like and what you should do if your insurance company is acting in this way.

Need immediate help with your car accident case? Unsure if you should take action or not? Give Alpha Accident Lawyers a call anytime for expert legal assistance.

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