When you file an insurance claim, you expect your insurer to handle it fairly and promptly. Unfortunately, some insurers act in bad faith, making the claims process frustrating and unfair. Understanding common examples of bad faith can help you spot if your insurer isn’t playing by the rules.
Denying claims without a reasonable basis
One of the most frequent signs of bad faith is when an insurer denies your claim without a solid reason. They might reject your claim even though your policy clearly covers the loss. This kind of denial is unfair and could be considered bad faith.
Delaying claim processing unnecessarily
Insurance companies should handle claims quickly. However, some insurers stall by taking too long to investigate or respond. These delays can cause financial strain and stress, especially when you rely on your insurance payout.
Offering low settlement amounts
Sometimes, insurers offer you settlements far below what your claim is worth. This tactic pressures you into accepting less money than you deserve. When this happens without proper justification, it may qualify as bad faith.
Failing to communicate properly
Good communication is key during a claim. If your insurer ignores your calls, fails to provide updates, or refuses to explain their decisions, it can be a sign of bad faith behavior.
Misrepresenting policy terms
In some cases, insurers might mislead you about what your policy covers to avoid paying a claim. This includes misstating policy language or denying benefits you are entitled to.
If you notice these behaviors from your insurer, it’s important to understand your rights. Bad faith insurance practices violate California laws designed to protect you. Keeping detailed records and knowing your policy terms can help you stand up to unfair treatment.
