Insurance companies have a duty to act in “good faith” when settling a claim. However that does not mean that insurance companies have not been known to prevent claimants from obtaining full justice, or even deny claims based on bogus reasons. It is important to understand bad faith and how Florida law views these attempts on the part of an insurance company. It is also important to consult an attorney who may be able to help you maximize the amount you collect for your injury from the insurance company.
What Is Bad Faith?
The term “bad faith” refers to any action by an insurance company that attempts to avoid paying out money or otherwise settling a claim for which they are legally liable. Your insurance policy, or that of the person who caused your accident, is paid for in advance to ensure that you have protection. If the company does not negotiate and settle a valid claim, the insurer may be guilty of bad faith.
Insurance companies have a legal duty to act in good faith toward any injured person if their own insured caused the accident. If you believe that a third-part insurer has acted in bad faith by withholding important evidence or by interfering with the settlement of a claim, you should speak to a personal injury attorney about the matter.
When Is It Not Bad Faith?
Not every denial by an insurance company is bad faith. Bad faith is predicated on a deliberate attempt to deny you the value of your claim, not a realistic dispute over the claim’s value. An attorney may elect to start by sending a letter to the adjustor for the insurance company claiming a possible bad faith action. If the insurance company is honestly trying to settle the case, this will usually elicit a rapid response and may
help bring the matter to a speedy conclusion.
Florida law makes provisions for those who want to file a bad faith claim against an insurer. As early as 1938, the Florida Supreme Court addressed the issue of third-party bad faith in common law. In 1982, the Florida legislature extended bad faith law to include first-party contractors as well. Today, Florida courts consider the lengths to which a insurer goes to provide the protection offered by the insurance policy when making a bad faith judgment. Our article, What is bad faith insurance, covers this topic in more detail.
If you believe you have been the victim of bad faith on the part of an insurance company, contact a personal injury attorney immediately. There is a statute of limitations that governs the amount of time you have in which to file a claim, so do not delay.