4 examples of bad faith actions from insurers

Getting in a car accident, having your home destroyed in a storm or losing a loved one in an accident are all tragic, life-changing events. The devastation each one can cause is often overwhelming, and people going through these difficult times typically have a hard time figuring out how they will ever recover.

Imagine being in this position and then learning that the insurance policy you thought was going to protect you and your loved ones actually will not. This is the experience too many Texans go through when their insurance company delays or denies a claim. In some cases, this is a truly unfortunate — but honest — situation; in other cases, it is an example of bad faith.

Bad faith is an intentionally deceptive or dishonest action. However, in the context of an insurance claim, it can be very difficult to distinguish between bad faith and unfortunate. Below are some examples of failed duties by insurance companies that can warrant bad faith claims.

  1. Failure to conduct a proper investigation within a reasonable time could constitute bad faith. 
  2. Failure to pay you at all or up to your coverage limit could constitute bad faith.
  3. Failure to provide you with defense to claims under your policy could constitute bad faith.
  4. In some jurisdictions, failure to settle reasonably can be considered bad faith.

We hope that this illustrates the fact that bad faith claims are not simply claims that are denied or delayed. They are claims that an insurer has not provided what was promised or fulfilled their duty as an insurer.

If you feel your insurance company has violated your rights as a policyholder, robbed you of benefits you deserve or failed to provide the coverage you were promised, it would be wise to consider discussing the situation with an attorney. A legal representative familiar with Texas bad faith laws can examine your case and help you pursue any compensation you may rightfully deserve.

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