Insurance Bad Faith - Western North Carolina

Each year Americans spend millions of dollars to purchase insurance policies they think will protect them if they are injured or in the event they accidentally injure someone else. Unfortunately, insurers frequently refuse to pay the legitimate claims of their policyholders.

All insurance policies are “contracts” between the insurance company and the person who pays for the policy. When a claim is made against the policy, the insurance company is required to treat its insured with good faith and fair dealing. This means that the company cannot simply look for reasons to unreasonably deny, delay or underpay a claim.

The attorneys of Melrose, Seago and Lay, P.A., recognize that insurance companies are businesses, which often means they rely heavily on the bottom line. Regrettably, for their insured this means insurance companies do not always do what they are contractually obligated to do. It can be difficult to prove insurance bad faith, especially without an experienced attorney to represent you.

Frequently asked questions (FAQs) about Insurance Bad Faith

What is insurance bad faith?

Bad faith is a legal term that is often employed where an insurance company has acted unreasonably or unfairly in the payment of a claim, or in the fulfillment of its duties to an insured. This includes instances where an insurance company has unreasonably denied, delayed, or underpaid a claim.

What are examples of insurance bad faith?

• Unreasonable delay in paying a valid claim or unreasonably refusing to pay a claim within policy limits
• Refusal to pay disability insurance benefits
• Denial of a valid claim without adequate investigation, or ignoring the findings of an investigation
• Termination of an insurance policy after a claim has been made
• Unreasonable refusal or failure to defend a policyholder who has been sued for injuring someone else
• Unreasonably offering to settle a claim for much less than its fair value
• Improper or incompetent handling of claims or reserving insufficient funds to pay the claim

Would it be worth my time and money to pursue a claim against my insurance company?

A successful bad faith claim against an insurance company could force the company to pay you:

• Everything that it owes under the policy, plus interest
• Any out-of-pocket expenses that you had to pay because the claim was denied
• Payment for any mental or emotional distress that you had because of the denial
• Payment to “punish” the insurance company and to discourage it from wrongfully denying valid claims in the future.