As a policyholder, you expect your insurance company to act in good faith when managing your claims. However, insurers may sometimes engage in practices that prioritize their interests over yours. Recognizing the signs of bad faith may help you protect your rights and ensure fair treatment.
Below are five key indicators that your insurance company might be acting in bad faith:
Unreasonable delays in processing your claim
Among the most common signs of insurance bad faith is when your insurer unnecessarily delays the claims process. It could be a red flag if you have provided all required documentation but still face prolonged waiting periods without explanation. Insurance companies must process claims promptly and efficiently.
Denying claims without proper investigation
Did your insurer deny your claims without a thorough investigation? This could be another sign of bad faith. Insurers must conduct a fair and comprehensive evaluation of your claim before deciding. If you suspect they dismissed your claim without proper consideration, it may be time to question their practices.
Misrepresenting policy terms or coverage
You may want to pay close attention to how your insurance company communicates with you about your policy. If they misrepresent the terms of your coverage or provide misleading information about the inclusions of your policy, it could be a sign of bad faith. You have the right to clear and accurate information about your insurance coverage.
Offering unreasonably low settlements
If your insurer consistently offers settlements significantly lower than your claim is worth, it might be acting in bad faith. While negotiations are normal, consistently undervaluing your claim or pressuring you to accept an inadequate offer is unacceptable.
Failing to provide a reasonable explanation for claim denials
When an insurance company denies your claim, they should clearly explain their decision. If you receive vague or inadequate reasons for a denial or the insurer refuses to explain their decision, it could indicate bad faith practices.
Protecting your rights
You may want to document all interactions with your insurance company if you encounter any of these signs. You have rights as a policyholder, and insurance companies are legally obligated to act in good faith when handling your claims.
Consider seeking legal advice to protect yourself from potential bad faith practices better. An attorney could help ensure you receive the coverage under your policy.