Bad Faith Insurance Coverage
An insurance company acts in bad faith when it unreasonably or dishonestly breaches a duty to the policyholder to pay a claim. When insurance companies act in “bad faith,” it refuses to meet its obligations under the insurance policy, which can have serious consequences for the policy holder.
The refusal to pay must be frivolous or unfounded. If an insurance company acts negligently or merely exercises bad judgment, this is not enough to establish that the insurance company acted in bad faith.
If you suspect that your insurance company has engaged or continues to engage in bad faith practices that have caused you harm, you may take action against them. In Pennsylvania, an insurance company who is found to have acted in bad faith is obligated to not only pay the claim, but is subject to punitive damages and the payment of attorney fees.
Types of Bad Faith Activities
Individuals and businesses purchase numerous types of policies. Individuals purchase automobile insurance to protect against the damages they may suffer, such as medical payment, collision coverage and uninsured motorist coverage, as well as liability coverage for claims against them.
Businesses buy a broad range of insurance products to protect against financial risks and exposures. These include: commercial general liability insurance, directors' and officers' liability insurance, property and casualty insurance, professional errors and omissions insurance, and interruption insurance.
Both individuals and companies purchase short-term and long-term disability products. The types of cases in which bad faith may exist include:
- Failure to pay medical benefits or wage loss benefits under an automobile policy.
- Failure to properly evaluate and pay an uninsured or underinsured motorist claim.
- Alleging arson on the part of a homeowner or property owner.
- Delaying the payment of benefits.
- Not providing a reasonable explanation for denial of claim.
- Attempting to settle the claim for an amount any reasonable person would refuse.
One of the biggest complaints has to do with the failure of an insurance company to pay life insurance proceeds.
David B. Dowing has successfully handled a bad faith claim involving failure to pay life insurance proceeds because the insurance company claims there was improperly reported information on the application. If you or a loved one has suffered damages as a result of bad faith of your insurance company, you should contact an attorney experienced in bad faith who will represent you with dedication and tenacity. We encourage you to call David B. Dowling, Esquire to schedule a free consultation and analysis of your case.
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