Having insurance should give you the peace of mind that you will receive financial security in case of property damage, disability or loss of a family member. However, you may find that when the time comes to file a claim, you will not receive the coverage you expected.
When insurers do not provide the benefits they promised, you are the recipient of bad faith insurance. As policies often can be complex, you may simply believe you are in the wrong and trust that the insurance company has a valid reason to deny your claim. However, watch out for these signs of bad faith insurance to prevent losing out on rightful compensation.
- Denial: The company may outright deny your claim with or without an explanation. It may even change your policy without your knowledge and then say your plan does not cover your claim.
- Accusation: You may face false accusations of fraud as an excuse for your insurer not to pay.
- Partial payment: Your insurer may offer you less than you deserve and not put effort into a proper investigation of the circumstances surrounding your claim or may use illegal or intrusive methods.
- Deception: Insurance reps may use vague language, misrepresent or withhold information, or deny you or your lawyer access to records. If you do receive payment, the company may not specify the policy coverage so you do not know if you are receiving enough.
- Delay: By far the most common, providers often use multiple tactics to cause delays in accepting or paying your claim as a sneakier way to avoid obligation. They may demand unnecessary paperwork or action, ignore your efforts to contact, fail to notify you of a denial, make empty promises or refuse to cooperate in any way.
Bad faith insurers may also punish you with higher costs, canceled policies, threats and misleading advice. Be sure to document any instances of these behaviors.