Every insurance policy is a bit different, but there are certain expectations every insurer must meet after an accident. In the state of Louisiana, every insurance policy must meet the minimum coverage requirements, which includes $15,000 in liability for 1 person, and $30,000 for multiple people, as well as $25,000 in property damage.
When a driver invests in this minimum coverage plan or additional coverage, he or she trusts that, when needed, their policy will cover the necessary costs. Unfortunately, not all insurance companies honor their legal requirement to act in good faith. Learn more about what you may legally expect from your insurance company in order to determine whether or not you are the victim of insurance bad faith.
All insurers are required to act in good faith, meaning they must make a reasonable effort to settle all claims and to do so in a timely manner. In some cases, companies may act in bad faith by attempting to prolong the claims process, looking for an out, which puts more stress and financial strain on the person filing the claim. By law, bad faith is acting “arbitrary, capricious, or without probable cause,” which some insurance companies may do to avoid paying for damages.
A company may act in bad faith by:
- Misrepresenting the facts related to the coverage specified in a person’s policy
- Failing to honor settlement deadlines within 30 days after an agreement was made
- Denying coverage for a reason the insurer knowingly altered without notice, consent, or knowledge of the insured party
- Misleading a claimant as to when the legal actions may begin
- Failure to properly compensate anyone insured by the contract within 60 days of receiving proof of loss from the claimant
- Denying claims when the denial is illogical or unreasonable
It is not illegal for the insurance company to refuse a claim, so long as that refusal is justified and does not go against the policy. However, if a company commits any of the acts lawfully defined as “bad faith,” the company did not fulfill their obligation to act honestly and fairly. Fortunately, there are legal repercussions for insurers who fail to handle claims justly.
If your insurer unfairly holds you responsible for your accident or provides you with inadequate settlement fees, you may be able to take legal action. At Insurance Claim HQ our attorneys can review your current situation to determine how your insurer acted in bad faith, and we will guide you through the best legal options.