Can You Get Punitive Damages From a Bad Faith Lawsuit?

Posted on August 18, 2023


Hayden Haskins | author

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ICHQ | Site Author

Working with insurance companies can be a double-edged sword. On one hand, they protect you and your family by paying for claims from damages you have suffered; on the other, they will try to hold power over investigating the damage and what exactly is owed to you.

As a policyholder, if you are doing your part by paying the insurance premium, the insurance company must do its part and pay for claims. If they fail to do so, they could be in breach of contract and the insurance bad faith attorneys at Insurance Claim HQ can help you recover damages from the insurance company.

Understanding Bad Faith Lawsuits

After experiencing damage to your home, an insurance company may underpay or deny a claim without a logical reason. Bad faith penalties exist to ensure insurance companies don’t take advantage of policyholders. Sometimes, legal recourse is necessary if your insurance company didn’t conduct a thorough examination.

Can You Get Punitive Damages from a Bad Faith Lawsuit in Louisiana?

In addition to compensatory damages in bad faith cases, some states allow victims to sue for punitive damages. Punitive damages are additional compensation for when a crime is so egregious that extra punishment is sought to prevent it from happening again.

As far as being able to receive punitive damages from a bad faith lawsuit, the state of Louisiana will not award them. Louisiana only awards punitive damages if there is a statute allowing them.

Under Louisiana law, punitive damages are only awarded under specific circumstances where an injury occurs such as drunk driving and domestic violence incidents.

These specific damages are uncapped, meaning there’s potential to create “nuclear verdicts” from jury awards. The millions-upon-millions are often negotiated down or appealed from what the jury originally decides. Ultimately, punitive damages are not likely in many cases, not just those involving bad faith.

What Other Damages Could a Homeowner Recover in a Bad Faith Lawsuit?

Punitive damages from a bad faith lawsuit may not be possible, but victims are still entitled to receive compensation if the insurance company did not follow the laws under the Louisiana state legislature.

Under statute 22:1892, the damages you can recover are “in addition to the amount of the loss, of fifty percent damages on the amount found to be due from the insurer to the insured, or one thousand dollars, whichever is greater…“.

Contact an Experienced Homeowners Insurance Claim Attorneys Today

If you suspect your insurance company rejected a claim without reason or provided an inadequate offer, contact us at Insurance Claim HQ. Our accomplished insurance bad faith attorneys in Louisiana can fight injustices from insurance companies. Don’t wait for the insurance company to make a decision — for expert input, contact our team of attorneys today.

Bad Faith Lawsuit FAQs

What does acting in bad faith mean?

When a company you have a contract with such as a homeowners insurance company behaves unethically, withholds information, or reduces the amount of compensation you are entitled to, they are acting in bad faith. Insurance companies have a legal obligation to pay the insured for claims reported and if they don’t, they should be held accountable.

How much is my bad faith lawsuit worth?

It’s difficult to provide an average for a typical bad faith settlement amount because every case is unique. It’s best to consult with a lawyer who can provide a personalized figure.