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Insurance Bad Faith

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Insurance is designed to be a safety net, a contract whereby the insurance company promises to provide protection so that you or your family will be compensated if you suffer a loss, whether it is for a car accident, damage to your home, or a medical emergency.

Insurance also provides protection if you are sued by a party claiming that you injured them. You have paid premiums for years to your health insurance, car insurance, homeowner's insurance, or life insurance company, and expect to be treated fairly when accidents and injuries occur that put you in jeopardy.

We trust insurance companies to compensate us after we're injured in an accident or pay for the repairs to a house or car which occur due to no fault of our own. That's why cases involving allegations of insurance bad faith are so infuriating. Instead of doing everything they can to help us out, some insurance companies try to take advantage of injury victims and give them less than what they rightfully deserve.

Attorney Stuart L. Plotnick knows the games insurance companies play. That's because he used to work as the lead trial attorney for an insurance company. Now, he puts that knowledge to work for injury victims and their families in Rockville and the surrounding communities.

If you think an insurance company isn't playing fair with you, contact the Law Offices of Stuart L. Plotnick, LLC in Rockville, Maryland. We can review the details of your case with you and fight for the compensation you rightfully deserve after your accident.

What is Insurance Bad Faith?

When an insurance company does not have a legitimate or reasonable basis for denying your claim for payment, downplays the severity of your injuries or loss, or delays or stalls in investigating your claim for too long, they are breaching your contract and may be acting in bad faith.

While no single one of the following factors necessarily indicates that your insurer is acting in bad faith, any combination of them means that a bad faith claim is probably worth considering:

  • Denying a claim based on trivial technicalities;
  • Claiming a certain kind of claim or loss is not covered (the "fine print" argument) under the insurance policy;
  • Claiming you had a pre-existing condition or that your loss was caused by some other event;
  • Repeated requests for information that it already has, or that is unrelated to your claim;
  • Failure to make a settlement offer within a reasonable amount of time;
  • Offering you an amount that is much lower than your actual losses or low-balling you;
  • Threatening to cancel your insurance or an unfair rate increase after you refuse a low settlement.

Insurance companies are required by law to pay all legitimate claims with good faith - promptly and properly. The law calls this obligation a "covenant of good faith and fair dealing." When an insurance company breaches this covenant and fails to pay their policyholder what he/she deserves, you can file a bad faith insurance case against them to hold them accountable.

Commonly Denied Insurance Claims

The following types of insurance claims are denied the most:

  • Car accident claims
  • Uninsured/underinsured motorist (UM/UIM) claims
  • Life insurance
  • Health insurance claims
  • Medical treatment or drug claims
  • Property damage claims from storms
  • Fire damage and loss
  • Wind and water damage, including mold

Warning Signs of Insurance Bad Faith?

Identifying the warning signs of insurance bad faith can sometimes be difficult. That's because insurance companies pretend they have your best interests at heart. But you know when something seems suspicious. Some of common warning signs of insurance bad faith include:

  • Not returning your phone calls
  • Giving vague answers to your questions
  • Asking you vague questions often designed to get you to say something they can use to deny your claim
  • Denying your claim without any inspection
  • Quickly concluding that your insurance does not cover the event or claim
  • Making a settlement offer almost immediately after your accident (before the full extent of your injuries are known)
  • Hiring their own experts and estimators who provide a lowball assessment of the loss
  • Suggesting you should sign their settlement offer without consulting with an attorney

If something feels wrong, you're probably right to be suspicious. Trust your instincts. Contact our law firm as soon as possible.

Rely On Us. We Can Help.

Attorney Plotnick's years of experience working for some of the largest insurance companies have given him inside knowledge of the tactics insurance companies use to deny and lower settlements for legitimate claims.

When you hire us, we will investigate your insurance company's practices, question the claims adjusters, and challenge the company with industry experts to make sure your claim is paid fairly if necessary.

Don't let insurance companies give you the runaround. Demand justice. Contact the Law Offices of Stuart L. Plotnick, LLC and schedule your free case evaluation right now. Best of all, you only pay us if we win. You have nothing to lose and everything to gain.

Insurance Bad Faith Questions

When is my insurance company committing "bad faith"?

Insurance companies are required by law to act in "good faith" - meaning they must reasonably resolve claims made by or against their policyholders seeking reimbursement for injury or loss suffered under the policy and in a timely manner. This means that the insurer should cover you for financial losses (auto, home, medical, health, life) according to the terms of your insurance policy. After all, you have paid premiums for many years.  When an insurance company denies your claim for no good reason, offers you an unfair settlement, or delays the processing of your claim for a significant amount of time, they may be acting in bad faith.

Bad faith happens more often than people realize. In the interest of protecting their bottom line and saving money, insurance companies often use any excuse at their disposal to deny or delay processing your claim or pay you less than your claim is actually worth. They know you may be desperate. Many people simply get discouraged by this stonewalling and give up trying to obtain the benefits they are owed. The insurance companies count on that and have the resources to drag things out and delay.

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Does an insurance company ever have a right to deny my claim?

Yes. If you have not provided full information or disclosure on your insurance application, not cooperated with the company in providing information in support of your claim, or if the type of loss is not covered by your policy, your insurance company can deny your claim in good faith. Bad faith conduct only occurs when the insurer's conduct is unreasonable or egregious and there is no real or reasonable basis for denying your claim.

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Should I accept my insurance company's settlement offer?

If your insurance company has intentionally offered a settlement that is far lower than what you deserve (often called "low-balling"), this is a form of bad faith. Many people accept these settlements without realizing what their injury claim or other loss is really worth because they are desperate for help. For example, the settlement may cover your current medical bills, but provide you with no way to pay for the long-term care and therapy that your injury requires. If you have any question about the amount offered, always get a second estimate. An insurance company will frequently use internal or outside adjusters, experts, and estimators that they have long relationships with, whose true loyalty is to the insurance company as they want ongoing work.

Your insurer is hoping you will accept a low settlement so it can resolve your claim by paying as little money as possible. Even though it claims you are in "good hands" or is your "good neighbor", in many cases this is a slogan, not a promise. Before you accept any kind of settlement from your insurance company, make sure you consult with an experienced insurance lawyer to find out the true value of your injury or property claim. Do not rely on their estimates without getting a second independent opinion.

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What damages can I recover if I sue my insurance company for bad faith?

If your insurer has wrongfully denied your claim or acted in bad faith, you may be eligible to recover damages for:

  • The full amount of compensation that your claim is worth
  • Interest on the claim
  • Attorney fees

In certain rare cases where the insurance company has exhibited gross misconduct, it may also be possible to receive punitive damages.

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What should I do if my insurance company is delaying my claim or not honoring my policy?

If you believe your insurance company is acting in bad faith, document everything in writing - including the claim you submitted, the insurance company's denial, and any statements, estimates, bills and documents that were exchanged. Also write down the name of your insurance adjuster and the name of their supervisor. Then, compose a formal complaint letter for the adjuster and copy their supervisor when you send it. If this letter fails to move things along, it's time to consult with an experienced insurance lawyer about pursuing a bad faith insurance case.

Attorney Stuart L. Plotnick was an insurance defense attorney for many years before dedicating his practice to personal injury victims. This experience has given him valuable insight into the tactics that insurance companies use to deny, delay, or low-ball claims. If your insurance company is giving you the runaround, we can help you hold them accountable.

If you have further insurance law questions, please contact the Law Offices of Stuart L. Plotnick, LLC today to schedule a free case evaluation with one of our Maryland insurance attorneys.

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