Not all injury claims submitted to insurance companies follow the same path or timetable. A claim by a policyholder to their own carrier is different than one made by an injured party to the insurance carrier of the responsible entity. Insurance companies are businesses that are regulated by each state.
Although Pennsylvania has a bad faith insurance law, insurance carriers can engage in bad faith tactics. These bad faith strategies are intended to drag out the claims process to discourage victims from pursuing a claim or taking a low settlement. Insurance companies do not accept claim payments made without going through their process. Sometimes, that process does not always operate in good faith.
For the insurance company policyholder, recognizing bad faith insurance tactics can light the way to recovery. A claim payout that is factually appropriate, equitable, and made in good faith is what every claimant should expect. Some bad faith tactics include:
- Denial without reason.
- Delays outside a reasonable period of time, including failure to respond.
- Failure to engage the claimant and conducting an investigation of the facts of the claim and the underlying damage or injury.
- Failure to communicate about a claim or notify of decisions in a timely manner.
- Not conducting a proper or appropriate claims investigation. This includes denial of a claim without any investigation.
- Insisting on unreasonable demands for irrelevant documents that are not involved in adjusting the claim. Not providing documents or not answering demands can lead to a denial of the claim.
- Offering considerably less money to settle a claim instead of starting with the true value of the claim. This includes undervaluing property damages or the extent and severity of injuries.
- Coming up with new policy terms for the policyholder or trying to cancel the policy.
- Invoicing the policyholder with new premiums or threatening to do this once the claim is settled.
- Making intimating threats if the claim is pursued or followed-up.
- Refusing a request for documentation or information by the claimant.
Understanding the Language of the Insurance Policy
Any action that is construed as intentionally misrepresenting the policy in order to minimize the claim’s value is considered bad faith. Insurance policies are not always in plain English or in plain language. Navigating through the policy language is something only an experienced and qualified lawyer can manage. A lawyer can identify conditions or terms that can be challenged.
Not every carrier representative makes the effort to be clear in language, tone, and meaning. Additionally, not everyone is receptive to keeping a claim file open on their desk or laptop. Moving the claims along a specific path is common among insurance companies; an open claim means more work. Offering a low settlement amount to close a file is a tactic. Whether it is in bad faith depends on many facts and factors.
When Do Claimants Experience Bad Faith?
For the injured third party filing a claim, there is likely no prior relationship with the carrier. The insurance company’s insured is alleged to be the party responsible for the damage or injury. A car accident is an example. Generally, insurance companies are liable for the total amount of the policy, and the policyholder is responsible for any overage.
Every state has its own definition of an insurance company’s acts of bad faith in adjusting and paying claims for policy amounts. As a general rule, bad faith is blatantly unfair conduct exceeding mere negligence. The cause of action is not contract breach, but it is a violation of a specific statute.
In Pennsylvania, there is a bad faith statute. While courts previously required a claimant to provide detailed examples of alleged bad faith and rejected conclusory assertions, a recent decision made it less onerous for a plaintiff to do so. It is sufficient to allege bad faith as grossly underestimating the extent of damage as well as grossly underpaying a claim where the carrier’s repair estimate did not meet industry customs.
How can a Lawyer Help With My Bad Faith Insurance Claim?
There are pitfalls throughout the insurance claims process, regardless if it is a property damage or significant personal injury claim. Even without bad faith tactics, policy requirements and claim details are intentionally difficult to manage for the outsider. The amount of the claim is not necessarily the issue, unless the demand happens to be in the upward range of the policy limits.
In Pennsylvania, if a bad faith claim is proven, there are other monetary damages that can be awarded, and these can be significant. A lawyer who specializes in bad faith insurance tactics can be invaluable. A lawyer can help their client collect evidence to prove that bad faith occurred, which is essential. A lawyer can fight on behalf of their client and ensure that their rights are protected.
Pittsburgh Bad Faith Insurance Lawyers at AlpernSchubert P.C. Protect Clients Against Bad Faith Insurance Tactics
If you believe that you were not treated properly by an insurance company when they processed your damage or injury claim, you should seek legal consultation. If you need help with your case, contact one of our experienced Pittsburgh bad faith insurance lawyers at AlpernSchubert P.C. Call us at 412-765-1888 or contact us online for a free consultation today. We are located in Pittsburgh, and we proudly serve clients throughout Allegheny County, Lawrence County, Washington County, and other regions throughout Western Pennsylvania.