When an insurance company acts in bad faith, its policyholders may be entitled to damages and other remedies. Many insurance companies have a duty of good faith and fair dealing with their customers, and when they fail to provide it, policyholders may have grounds for legal action. To prove that an insurance company acted in bad faith, several methods can be utilized.
The Insurer’s Conduct Was Unreasonable
First, the policyholder must be able to demonstrate that the insurer's conduct was unreasonable or unconscionable. For example, if an insurer denied a valid claim without any reasonable justification or refused to pay out on a legitimate claim after repeated requests from the policyholder, this type of behavior would likely constitute bad faith.
The Insurer Had Knowledge of the Damage
Second, the insured must be able to show that the insurer had actual knowledge of the damage it was causing or should have known about the harm being caused. This can be done by showing evidence of a history of similar conduct from the insurer or other instances where the insurer failed to uphold its contractual obligations in a fair and reasonable manner.
Insurer Delays
Third, if there were delays on the part of the insurer in processing a claim or providing payment, this could also be considered evidence of bad faith behavior. The policyholder must be able to prove that these delays were unreasonable and unnecessary, which could potentially provide grounds for legal action.
Other Ways to Prove Insurance Bad Faith
In addition to these three methods, there are also other ways that an insurance company may act in bad faith toward its customers. For instance, if the insurer fails to properly investigate a claim, unreasonably interprets the policy in its favor, or attempts to strong-arm the policyholder into settling for an inadequate amount of compensation, these are all considered acts of bad faith.
In any event, it is important for policyholders to understand that they have legal options if they believe that their insurance company has treated them unfairly. If you believe that your insurer has acted in bad faith towards you, then it is important to speak with an experienced lawyer from Berthold Law Firm, PLLC who can help you seek justice and restitution.
If you have been harmed by insurance bad faith and need help with a lawsuit, contact the skilled attorneys at Berthold Law Firm, PLLC with the details of your case by calling (304) 605-2040 or by filling out our online contact form.