Proving An Insurance Company is Acting in Bad Faith
August 15, 2022 | Insurance
Insurance is supposed to protect you financially after a Seattle car accident, or other injury to your property or person. Under state law, all insurance carriers are required to operate in good faith and fair dealing by treating policyholders in accordance to the contractual obligations. However, there are times when insurance carriers fail to uphold the terms of the contract they have with the policy holder, and this can sometimes lead to bad faith insurance practices. Here, we want to list what constitutes bad faith and describe how policyholders can go about proving these bad faith practices.
What Are Bad Faith Insurance Practices?
Every insurance carrier in the state of Washington is required to operate in “good faith and fair dealing.” This means that the insurance carrier should uphold its end of the contract they have with the policyholder so long as a valid claim is made. Unfortunately, not all insurance carriers necessarily operate in good faith and fair dealing. Sometimes, they choose to use bad faith insurance practices.
There are several ways that insurance carriers can practice bad faith. This includes, but is not limited to, the following:
- Not giving a legitimate reason for failing to pay a claim
- Refusing to properly investigate the claim in a timely manner
- Making unreasonably low settlement offers
- Demanding a ridiculous amount of paperwork or evidence
- Making threatening statements toward a claimant
- Attempting to convince a claimant not to work with an attorney
- Purposely misconstruing policy language
Proving Bath Faith
Actually proving bad faith insurance practices can be challenging because there are times when insurance carriers may act in a way that seems unfair that is not necessarily bad faith. Proving bad faith typically means showing the following:
- That the insurer withheld a benefit specifically provided for in the policy, and
- The decision to withhold the benefit was unreasonable or done without proper cause under the terms of the policy or Washington law.
If you believe that your insurance carrier has operated in bad faith, it is crucial to contact a Seattle bad faith insurance attorney who has experience handling these specific types of claims. We encourage you to keep copies of all correspondence and, if possible, record any conversation you have with insurance claims adjusters. When you work with an attorney, it will be their job to take over every aspect of your claim. The attorney will investigate not only your original claim but also the denial of the claim. They will dig into the language of the insurance policy and examine the behavior of the insurance carrier from the moment the claim was made
Individuals who file bad faith insurance claims may be able to recover various types of compensation for their losses. First, this includes all compensation originally owed to a person for the claim that was denied in bad faith. However, a successful bad faith insurance claim could also result in additional types of compensation that the insurance carrier will have to pay as a punishment for their bad faith practices. This can include statutory penalties, attorney fees, emotional distress compensation, and possibly even punitive damages.