Insurance bad faith describes a claim that a policyholder makes against an insurance company due to unethical or unlawful business practices. In most jurisdictions of the United States, insurance providers owe a duty of good faith and fair dealing to policyholders. This standard is known as the “implied covenant of good faith and fair dealing.”
If your insurance company treated you unfairly, then you may have grounds for both a contract claim and an insurance bad faith claim. The bad-faith claim is unique in that extra contractual and/or punitive damages may be recoverable if your carrier acted in bad faith in handling your claim.
If you believe that your insurance company treated you unfairly, contact Leader & Leader P.A. Our office is available 24 hours a day, seven days a week. Call 954-523-2020 to schedule a free initial consultation with an insurance lawyer in Fort Lauderdale.
What Constitutes Insurance Bad Faith?
Insurance bad faith takes many forms. Pursuant to Section 624.155 of the 2016 Florida Statutes, the following may constitute insurance bad faith:
- Insurance company takes too long to make a decision on a claim;
- Insurance company fails to investigate a claim thoroughly;
- Insurance company denies a legitimate claim;
- Insurance company unreasonably interprets the policy language; and
- Insurance company requires the insured to provide unreasonable documentation.
When Can Insurance Companies Deny Claims?
An insurance policy is a contract, and both you and your insurer have specific responsibilities. For example, you are responsible for paying your premiums on time, and your insurer is responsible for covering your damages in the situations outlined in your policy.
If you do not fulfill the terms of your insurance policy, then your provider may deny your claim. Also, your provider may deny your claim if it is fraudulent or is not covered by your policy. Any lies or misrepresentation from the initial application or during the claims process can potentially give the carrier a legal basis to refuse to pay.
Can Insurance Companies in Florida Deny Claims without Providing an Explanation?
In Florida, it is illegal for insurance companies to deny claims without providing a reasonable explanation. The insurer must provide this explanation to the policyholder in writing.
Is It Pointless to File a Lawsuit against My Insurance Provider?
Insurance companies usually have an army of attorneys who specialize in defending against under paid, improperly denied and/or bad faith claims. However, this should not dissuade you from taking legal action if your insurer has treated you unfairly.
Florida has laws that protect the rights of the insured, and an insurance attorney can explain these laws and how they relate to your case. For example, if you have to sue your own insurance carrier in the State of Florida to enforce your rights under your policy and you get any decree, judgment or ruling in your favor, the insurance company is generally obligated to pay all of your reasonable attorney fees and costs. Consequently, these cases are normally handled on a contingency which means very little or NO out of pocket expense for you. Unlike auto accidents and most personal injury claims where your contingent attorney takes a third or 40% of your recovery as the fee, in most instances, our client’s get 100% of their recovery (unless they have contracted to give a public adjuster a percentage) and our fees and costs are paid in addition directly by the insurance carrier. If you would like to speak with an insurance lawyer in Fort Lauderdale, contact Leader & Leader P.A.
Michael D. Leader will evaluate the merit of your claim in a free consultation. Call 954-523-2020 to discuss your case.