Over the last generation, insurance companies have become more concerned with their own profits and the price of the shares of their stock. This is wrong. Insurance companies must place the public’s well-being before their own interest. Smart judges and savvy legislatures know that insurance companies cannot be left to their own devises. And that is where the law of “bad faith” claims practice comes in.
In the United States, most states have developed law, whether it be by statute or through the courts, whereby insurance companies must adjust the policyholder’s claim in “good faith”. Courts and legislatures perceive the obligations of insurers different from manufacturers of products, since the insurers are providing a service that affects the general public interest. When buildings burn to the ground or when tornadoes rip through a town, the public need is for a quick rebuild so that people who suffered the loss can go on with their lives and continue to contribute to the local economy. Thus, insurers as suppliers of services that affect the well-being of the general public, must take seriously what effect their actions will have on the local economy.
Thus, the law places an additional requirement upon insurance companies to treat their customers fairly – with serious consequences such as punitive damages if they fail to do so. In addition, many states have passed laws that place additional obligations upon insurance companies regarding what they can and cannot do when dealing with a customer and when processing a customer’s claim for insurance benefits.
An insurer that is found to have acted in bad faith can be liable for damages for amounts greater than the policy limits, statutory penalties, interest, attorneys’ fees, and punitive damages.
At Anthony Bruozas & Associates, the attorneys have been handling bad faith insurance cases for over thirty years. Please call 708-370-0769 for a free consultation if you believe your insurance claim has been wrongly denied and there may be bad faith on the part of the insurance company.