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Dealing with a Bad Faith Insurance Company

By stladmin on January 20, 2019

Insurance is a part of our everyday lives. It’s a way for you to protect against unforeseen events, whether a car wreck, a health emergency, or a fire in the home. Based on the many, many insurance commercials on TV, it would seem like insurance companies are only concerned with helping us in our time of need.

The reality is insurance companies are among the largest, wealthiest corporations in the world. In our years of practicing law in Gillette, we’ve seen countless insurance companies put their bottom line ahead of the welfare of their clients.

There’s a term for a company that doesn’t fulfill its obligations and looks to limit the amount of money it has to pay out: bad faith. At Steven Titus & Associates, P.C., we’re dedicated to fighting on your behalf to make sure you get every penny you deserve following an accident. Call today at (307) 257-7800 to learn more.

Victims Are Often at the Mercy of Their Claims Adjusters

When you purchase insurance, you assume you’ll be protected. That’s the reason we purchase insurance in the first place. But the truth is, once you file a claim, it’s up to the insurance company to determine the validity of your claim.

What exactly do we mean by bad faith insurance? Generally speaking, this means an insurer is unreasonable in the way it responds to a claim. According to the theory of common law torts, an insurer is expected to provide its policyholders “fair consideration.” Traditionally, these companies are afforded a great deal of leeway when it comes to resolving claims, but they have to act in good faith—and treat you fairly.

However, each state has established its own definitions of what bad faith is. For Wyoming, there are two elements to establish an insurer is acting in bad faith when it denies a claim. First, it must be shown there is no reasonable basis for denying the claim. Second, it must be shown the insurer was aware of the lack of reason for denying the claim.

Of course, there is a lot of uncertainty as to what constitutes a “reasonable” denial of a claim. The question is whether the disputed claim is debatable. The Wyoming civil courts will look at whether another competent insurer would have denied a similar claim under the same circumstances.

How Can You Prove a Bad Faith Insurance Claim?

If an insurance company is withholding money you feel you are entitled to according to your policy (or the at-fault person’s policy), you can file a bad faith insurance lawsuit against the company. It will be necessary to show two main points to succeed with your case.

1. You must show you are covered under a valid policy with the company in question. You need to have followed all the procedures laid out in the policy when filing your claim, and you must show proof the claim was filed. For instance, if your policy lapsed, or you filed a claim too late, it may be impossible to win such a case.
2. You need to show the reason your insurance company gave for withholding the benefits is unreasonable. There are a number of approaches you can take when taking on bad faith insurance companies. For example, one option is to show your insurer misstated the facts pertaining to your case or didn’t follow the provisions outlined in your policy. In other instances, it’s possible to show the insurer did not provide a reasonable explanation for denying the claim. Sometimes, an insurer did not act promptly after it received the claim and did not make a decision in a reasonable amount of time. We’ve seen examples where the company fails to acknowledge a claim altogether, which is evidence of a breakdown in their claims process.

Most of the time, your case will depend on the standards that particular insurance company has established for handling claims. If an insurer fails to follow its own guidelines, it is susceptible to charges of acting in bad faith. If it hasn’t adopted reasonable standards for investigating claims at all, then it will be very difficult for that insurer to prove it has acted in a reasonable manner!

How Do I Know My Insurer Is Acting in Bad Faith?

Unfortunately, many insurers act in bad faith because their customers don’t realize what’s happening to them is against the law. Claims are denied all the time for legitimate reasons, and it can be difficult for people who aren’t well-versed in Wyoming law to know the difference between proper and improper industry practices.

If you think a company is acting in bad faith, consult with an experienced Gillette bad faith insurance lawyer right away. At Steven Titus & Associates, P.C., we deal with unethical insurance companies on a daily basis and we aren’t afraid to stand up for your rights. Call us today at (307) 257-7800 for a free consultation.