By consistently paying your insurance premiums, you can anticipate having a safety net during difficult times. However, there is no assurance that your insurance company will respond promptly.
So, what happens when your legitimate claim is met with unreasonable delays or denials? This can be frustrating and stressful, leaving you wondering why your provider hesitates to fulfill its obligations. Understanding the concept of bad faith insurance can shed light on these tactics and empower you to take action.
What is bad faith insurance?
Bad faith insurance occurs when your insurer acts unreasonably in handling your claim. This doesn’t necessarily mean intentional malice but rather a disregard for their ethical and legal responsibility to act in good faith and uphold the terms of your policy.
A reasonable timeframe for claim processing exists, and excessive delays without explanation can be a sign of bad faith. This could involve repeatedly requesting unnecessary documentation or delaying communication.
Other practices that constitute bad faith might include denying your legitimate claim without a valid reason or offering you a settlement that’s far below your claim’s genuine value. The primary motivation behind bad faith insurance is financial gain, as insurers aim to minimize payouts and maximize profits.
However, suppose you have an insurance policy from a large insurance company; their multiple layers of management and approval processes might be the culprit behind your delayed settlement. This red tape can slow down the processing of claims, even if there is no malicious intent. However, insurers are responsible for streamlining these processes to serve their customers better.
If you suspect that your insurance provider is practicing bad faith insurance approaches, you can benefit from personalized legal feedback on the matter. A trusted legal team can help you secure the settlement you are owed following an unexpected tragedy.
