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What are bad faith insurance claims?

On Behalf of | Nov 17, 2021 | Uncategorized

Arizona residents may not think much about their insurance policies until the time comes to file a claim. A homeowner or auto policy provides equitable payments for covered losses, and many policyholders rely on those insurance policies to protect their financial well-being in the event of a catastrophic loss. Unfortunately, not every insurance company intends to pay as promised, leading a customer to take action against the provider’s “bad faith.”

Bad faith insurance matters

When an insurance company fails to live up to its contractual agreements, the insurance company allegedly acts in bad faith. Attempting to avoid paying a client for a legitimate claim is one example of bad faith. Refusing to investigate a matter timely would be another.

If an insurance company refuses to pay for a wind-damaged roof due to falsely suggesting that neglect led to the damage, the homeowner may have a bad faith claim. When the insurance company doesn’t visit the property to look at the damage within an acceptable time frame, the “foot-dragging” could indicate an attempt to skirt responsibilities.

Sometimes, an insurance company may attempt to creatively interpret contract language to deny a claim. A company may suggest that something is not covered in the policy even when it is.

Taking action on bad faith negotiations

Although an insurance provider may attempt to escape its responsibilities, civil courts could enforce the contract. Suing a provider for denials and bad faith insurance claims might result in a judgment that forces the company’s hand.

Providing the necessary evidence to counter the insurance company’s claims is essential. If the insurance provider tries to avoid a dog bite case because the pet involved is an excluded breed, for example, proof that the animal is not an excluded breed would be necessary. Other cases might be more complicated, but clear evidence may work in the plaintiff’s favor.