Insurers are supposed to act in good faith when investigating a claim. Unfortunately, far too many insurers are more interested in their bottom lines than paying out on legitimate claims. When insurers act in bad faith they deny claimants the financial resources those claimants deserve and may need to lead a decent quality of life. A lot of people, however, don't have much experience dealing with insurers and so spotting some common indicators of bad faith practices can be tricky. Here are just five signs of potential insurance bad faith to watch out for.
Whether it's a delay in actually coming to a decision about the validity of your claim or a delay in paying out on an approved claim, delays are a common tactic used by bad faith insurers. If an insurer has no valid reason for delaying a settlement, then that insurer may simply be hoping you give up on your claim or accept a low offer just to get the process over with sooner.
An insurer has to investigate the validity of your claim, which may require it to ask you to provide certain documents. However, those demands cannot be unreasonable. If the insurer starts demanding documents that appear unrelated to your case then they may be trying to make the claims process overly difficult for you.
Lack of investigation
Alternatively, in other cases the insurer may not actually perform a proper investigation and simply deny your claim outright. If you suspect a proper investigation has not been performed--such as if the insurer asks for little or no documentation or comes to a decision on your claim suspiciously quickly--then you may be able to pursue a claim of bad faith.
Moving the goal posts
You and your insurer are required to abide by the terms of the policy you have taken out with them. The insurer cannot change the terms of your policy or cancel the policy after you have filed a claim unless they have a valid reason for doing so. Even if the insurer claims to have reasonable grounds for cancelling the policy, you should seek legal advice about whether those reasonable grounds really are valid.
Finally, lowball offers have become almost routine for many insurers. You should be wary about accepting an insurer's first offer and especially cautious if any offer the insurer makes is much less than you expect. While there is room for negotiation in terms of the size of a settlement, an unreasonably low offer is an act of bad faith.
If you are having trouble getting the settlement you believe you deserve from your insurer or if your insurer has been behaving in a way that may constitute bad faith, then it is time to contact a consumer protection attorney. The attorneys at Weisberg Law have lots of experience dealing with insurance bad faith and they may be able to help you with your own claim.