The aftermath of a car accident can be very chaotic. Having car insurance should give you peace of mind, knowing that you can file a claim and recover compensation for your losses. Unfortunately, filing a car insurance claim can become complex, and not all claims are approved. The last thing you want to do after sustaining serious injuries is deal with an insurance company that gives you the runaround or denies your valid claim. Keep reading to learn more about bad faith insurance, how it may pertain to your car accident, and how to ensure your insurance company does what they agreed to do.
What is Bad Faith Insurance
“Bad faith” in the context of insurance claims refers to any instance in which an insurance company does not uphold their end of the contract. You and your insurance company have a contract together, stating that in exchange for your monthly payments, they will assist you financially in the event of a car accident. There are of course stipulations and exceptions, but there are still plenty of instances where insurance companies drop the ball.
Insurance companies are held to a “duty of good faith.” This means that they are legally bound to act honestly and honorably, just as you are required to provide honest information to them. A duty of good faith means that the insurance policy needs to be followed, even if it hurts their profits. As a paying insurance holder, you have rights.
Examples of Bad Faith After a Car Accident
There are a number of ways in which your insurance company may act in bad faith after a car accident. Some of those ways include:
- Denying your claim, even when it is valid
- Delaying payment on your claim
- Ceasing communication or failing to properly explain your claim denial
- Demanding an unreasonable amount of evidence for your claim
- Failing to properly evaluate your claim / providing a lowball offer
- Requesting an unreasonable amount of paperwork
- Unreasonably terminating your policy or certain coverage
If your car accident claim was denied but none of the bad faith examples from the list apply, there may be a valid reason for your claim denial. Unfortunately not every insurance claim is actually eligible for a payout.
Reasons for a valid insurance claim denial include:
- You were partially or fully at fault for the accident (i.e. driving under the influence)
- You did not receive medical care or did not properly document it
- Your car accident injury is too minor to receive compensation, such as whiplash
- You did not disclose pre-existing injuries to your insurance provider
- The claim exceeds your policy coverage
- You did not file the claim within the required time limits
What To Do If You Think Your Claim Denial Was in Bad Faith
If your car accident claim is denied for a valid reason, you can still try and recover compensation. A lawyer can help negotiate a settlement with the at-fault driver’s insurance company, or file a personal injury lawsuit if needed. Most personal injury and car accident lawyers offer a free consultation during which they can determine if you have a case. You should absolutely take advantage of these free consults, and do not provide the insurance company with a recorded statement before speaking with a lawyer.
If you think the insurance company acted in bad faith and you want to fight back, an attorney can also help with that. Insurance companies are large, wealthy, and profit focused which makes it incredibly hard to fight back without the help of a lawyer. Contact an attorney who specializes in bad faith insurance claims, and they will help you fight for justice.