Bad faith insurance results when the insurance company wrongfully denies an insurance claim. Bad faith insurance suits can arise in the context of any insurance policy, including property insurance. Florida law created liability for insurers who act in bad faith in denying insurance claims. This post will go over bad faith insurance and what duties you are under to ensure your right to pursue compensation.
The Florida bad faith insurance statute requires insurers to settle a claim and negotiate in good faith. But does the state impose a reciprocal duty on the claimant? The statute does not explicitly impose such a duty. However, Florida common law (judge-made law) has long recognized that the duty to act in good faith is a two-way street.
Good faith is the obligation to act with good intentions and an honest attempt to reach an accord. If you go into the settlement negotiations determined to throw the negotiation or extract an unfair price from the insurance company, you did not act in good faith.
So creative claimants cannot create incidents with their insurance company to induce a bad faith claim. But, since the law is vague, claimants continually try to exploit this loophole. Unfortunately, that also means that these set-ups can drag legitimate claims and disputes before the court when they should be settled.
Property insurance claims are a heavily litigated area of law in Florida. If you had a claim that was denied, you might want to contact an attorney to ensure that your right to compensation is not unjustly denied. After a disaster, the best (and often only way) your business can rebind is with its property insurance coverage. A lawyer can help ensure that your business can return to operations as soon as possible.