What Should I Do When My Insurance Company Denies or Delays Payment on My Claim?
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UPDATED: Aug 5, 2019
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If you have a denied or delayed insurance claim, you may be in a difficult situation. If your insurance company has a valid reason for denying your claim and your appeal, meaning that the company has proof that it is not obligated to cover the situation in question, you probably have little recourse. If, however, you have carefully examined your insurance contract and you believe the insurance company is in the wrong by denying your claim, then it may be possible to pursue legal action.
Denied Insurance Claim: Understanding a Bad Faith Claim
All insurance companies have the obligation under the law to act in good faith, which means that they must live up to the contract they have with you, and pay for claims that fall legally within the bounds of the contract. These protections are necessary since consumers pay for insurance in the event that something will happen. The law must make sure that they are then paid if that somethingdoes occur.
Therefore, if your insurance company seems to be trying to avoid paying a claim for which they are contractually obligated, the company legally may be acting in bad faith. In such a situation you can bring a civil action for damages against the insurance company on the basis of bad faith behavior. This may involve one or more charges of bad faith as well as charges of breach of contract.
If you are fighting a denied insurance claim, you will need the advice and representation of a lawyer in order to take action. Your attorney can help you with the court paperwork and with proving your claim. Should you win your case, the lawyer’s fees may be considered damages that the insurance company will also be liable to pay.