If you’re involved in an accident, you expect the insurance company to treat you fairly, especially if it’s your own insurer and you’ve always paid your premiums on time. However, dealing with insurance claims is an inherently adversarial process. The company wants to minimize the value of your damages to protect its profit margin, while you want to recover fair compensation for the harm you’ve suffered.
However, there is a difference between insurance adjusters doing their job and acting in bad faith. If you were treated unfairly by an insurance company and think this might rise to the level of bad faith practices, contact an experienced personal injury lawyer for a free case review.
What Are an Insurance Company’s Legal Responsibilities?
Insurance companies like Allstate and GEICO that operate in the state of Texas are required to follow rules outlined in the Texas Insurance Code, including:
- Providing accurate information about applicable insurance coverage and policy terms
- Promptly processing claims without making unnecessary or unreasonable delays
- Providing a valid and reasonable explanation for any denials
- Attempting to fairly settle valid claims
- Promptly paying settlements without requesting unnecessary information
Violating these requirements or not meeting specific deadlines outlined by the law can be grounds for a bad-faith insurance claim.
What Is Bad Faith?
Bad faith is dishonest or fraudulent dealings. Insurance companies are held to strict standards in Texas.
They must generally meet the following deadlines when dealing with claims:
- 15 days to acknowledge a claim, begin an investigation, and request additional information after receiving written notice of the claim
- 15 days up to 45 days to determine whether to deny or approve a claim after receiving any additional requested information
- 5 business days to pay accepted claims after approval
- 60 days to make a claim determination in most situations
Texas law allows claimants to file bad faith claims if these or other rules are violated.
Examples of Bad Faith Insurance Practices
Bad faith can take on many forms, including any violation of the insurance company’s legal duties, as well as unfair or unreasonable behavior under the circumstances.
This could include acts such as:
- Requesting unnecessary information before processing a claim
- Causing unnecessary delays
- Citing language that does not appear in an insurance policy
- Referring to non-existent policy provisions to justify a claim denial
- Misrepresenting the terms of an insurance policy to justify a denial
- Failing to investigate a claim
- Failing to provide a valid reason to deny a claim
- Making blanket denials
- Changing an insurance policy after a claim is filed to include language to justify a denial of the claim
- Offering an unreasonable amount to settle a claim
- Trying to convince the claimant not to hire a lawyer or pressuring them to accept an unreasonable settlement offer without legal advice
Bad faith insurance claims are often fact-specific. It’s important to have a qualified lawyer investigate your situation to determine if bad faith is occurring.
Who Do I Have a Bad Faith Claim Against?
Bad faith is derived from a breach of contract claim. Therefore, you can file this type of claim against an insurance company when they deal with you in an unfair manner. This could result from a first-party or third-party claim.
A first-party claim is a claim you file with your own insurance company for your damages. For example, you may have filed a claim for uninsured motorist coverage after being injured by a driver with no auto insurance.
A third-party claim applies when you file a claim with someone else’s liability insurance provider. Under an insurance contract, the insurer has the legal obligation to resolve claims filed by third parties in a reasonable manner. If the insurance company fails to uphold these duties, you may have a bad faith claim against them.
Is a Claim Denial Automatically Bad Faith?
A denial is not necessarily bad faith.
There may be valid reasons for a denial, such as:
- The policy had lapsed at the time of the accident because of nonpayment
- The claimant failed to provide the requested information that was necessary to process the claim
- The claimant was primarily responsible for the accident
- Insurance coverage did not cover the particular type of accident
Insurance companies can legally deny claims based on the law or insurance provisions. An experienced lawyer can review the situation and determine if the denial is due to bad faith or is valid.
Compensation Recoverable in a Texas Bad Faith Claim
In a Texas bad faith insurance claim, you may be able to recover damages such as:
- Actual losses, including medical expenses and the cost to repair your damaged property for a claim that was wrongfully denied
- Attorney’s fees to defend yourself or assert your rights
An experienced attorney can help you identify these and other damages you may be entitled to in a bad-faith insurance case.
Contact a Fort Worth Bad Faith Insurance Lawyer For a Free Consultation
If you want to learn whether you have grounds to file a bad faith insurance claim, contact us at Anderson Injury Lawyers for a free, no-obligation case review. A lawyer can investigate your claim, review insurance policies and communications with you, and determine whether the company has acted in bad faith. Call our Fort Worth bad faith insurance attorneys today for a free case review. You can call us today at (817) 294-1900.