We all rely on insurance companies to protect us when something goes wrong, whether it’s a car accident or a house fire or a medical emergency. But what can you do if your auto insurance company rejects your claim without an explanation, fails to adequately investigate the claim, or attempts to settle the claim for far less than it is worth?
Fortunately, the law provides recourse for people when their insurance companies unreasonably deny a claim or engage in other wrongful conduct. It’s called a bad-faith lawsuit.
What is a bad-faith lawsuit?
Think of your auto insurance policy as a contract with your insurance company. You agree to pay for coverage, and the insurance company is obligated under state law to compensate you in a fair and timely manner when you submit a legitimate claim for damages resulting from an accident. When an insurance company fails to act promptly on the claim, arbitrarily rejects that claim, or attempts to settle it for far less than what would be considered reasonable under the circumstances, the policy holder can file a bad-faith lawsuit against the company. “Bad faith” means that the company failed to do what it promised to do under the terms of the policy.
Do I have a bad-faith case?
In Colorado, an insurance company’s duties to its policyholders are specified, in part, under the Unfair Claims Protection Act. Among other prohibited practices, insurers could be found to be engaging in unfair claims practices if they:
- Misrepresent relevant facts about a claimant’s policy or coverage.
- Fail to promptly acknowledge communications related to claims.
- Fail to adopt reasonable standards for prompt investigation and settlement of claims.
- Don’t attempt in good faith to reach a fair settlement.
- Unreasonably delay payment of claims.
Related: Federal Arbitration Act holds strong under Supreme Court: What it means for you
Important elements in bad-faith cases include being able to establish that the plaintiff suffered serious and substantial injuries and that the situation was exacerbated by the insurance company’s conduct—for example, by prolonged delays in handling the case or outright refusal to pay. Insurance companies found to have engaged in bad-faith conduct can be liable not simply for the benefits limits specified in the policy but three times that amount, plus reasonable attorneys’ fees and costs.
How Our Attorneys Can Help You
Bad faith lawsuits are much more difficult to pursue than the typical personal-injury claim arising from an accident. In addition to proving the damages resulting from the accident, the plaintiff also has to establish the wrongful conduct of the insurance company, which has enormous resources it can draw upon in defense of its actions (or inaction). Insurance companies will go to great lengths to defend their bottom line, and you will need legal representation that is fully committed to getting you the compensation you deserve. If you are considering a bad-faith lawsuit, you should enlist the aid of experienced attorneys and a law firm that has a proven track record in successfully fighting insurance companies.
At Franklin D. Azar & Associates, our attorneys have helped thousands of injured people obtain complete and timely compensation for their losses. We have recovered millions of dollars in bad faith cases, including recent settlements of $875,000 and $921,000 against major insurance companies. Our proven track record and expertise have allowed us to grow into the largest personal-injury law firm in Colorado, and we are ranked as one of the top law firms in the nation in litigation against insurance companies. If your insurance company isn’t dealing with you fairly, please call the bad faith lawyers at FDAzar day or night at 720-372-2824 or contact us here for a free consultation and no-obligation evaluation of your case.
