4 Reasons Why You Should File a Bad Faith Insurance Claim
In general terms, a bad faith claim arises when a company with whom you have a contract fails to act within the terms of the deal. When it comes to insurance companies, this may happen for a multitude of reasons. If you are questioning whether or not you have a case, we will discuss some of the instances where you need to take action. Here are 4 reasons why you should file a bad faith insurance claim:
1. Intentional Breaking of Contract
It’s pretty simple, your insurance policy is a contract between you and your insurance company. In this case, both parties receive a benefit from the deal. Your insurance company receives a premium and you receive payment for losses covered under the policy. So what do you do if your insurance company doesn’t hold up their side of the contract? Well, that is when you could file a bad faith claim. If they are purposely ignoring the terms of the contract or are not responding to you for an extended period of time, you might want to consider filing a claim to ensure you get what you are entitled to.
2. Statutory Bad Faith Claim
Insurance companies in the state of Tennessee have a legal obligation to act in good faith. While this term is used a lot, some people do not use it in the right context. Basically, this means the insurer is required to accept valid claims so that the insured can receive the benefit provided by the contract. If the insurance company, in bad faith, denies your claim, that is when you need to contact a legal advisor. Something important to know here is that every denied claim does not constitute a bad faith insurance claim. You must prove that the insurance company’s refusal to pay (or respond) to your claim has been done in bad faith.
3. Breach of Contract
When you are dealing with an insurance company, they are required to deal with you honestly and fairly. If your insurance company breaches this covenant of good faith, you may be able to file a bad faith claim. The good news is that a breach of contract claim is broader than what we previously talked about with a statutory bad faith claim. A couple of the most common cases where you are able to file this type of claim involve coverage issues. If your insurance company is refusing to pay claims without conducting a reasonable investigation, that would be a good time to file a claim.
4. Steps to Take
Now that you understand why you might need to file a bad faith insurance claim, you may be wondering how to go about it in the right way. The first thing you will want to do is review your insurance contract. This sometimes can be a lot easier said than done. Many contracts contain fancy jargon that is not easy to understand. That is where it comes in handy to have a professional attorney on hand to help out. You will also want to maintain a record of contact between yourself and your insurance company. If the problem is they are not responding to you, it is best to know exactly how many times you have tried to reach them and when.
Our east Tennessee lawyers can help you determine whether or not you need to file a bad faith insurance claim. We can help you settle the matter or file a lawsuit if that is a necessary step to solve the issue. Feel free to contact us for a free consultation and we can help you or a loved one better deal with suffocating insurance companies.