Signs of Bad Faith Insurance Settlement Practices

Bad Faith Insurance Practices

An insurer may be acting "in bad faith" if the insurer delays, discounts or denies payment without a reasonable basis for its delay, discounting or denial. For example, the insurer using delaying tactics to get the insured to to accept a settlement offer as they don't want to wait any longer for a resolution to the claim or, the insurer attempting to settle a claim for less than the amount to which a reasonable person would have believed was entitled or attempting to substantially diminish a claim requiring an insured to initiate litigation. There are many types of bad faith insurance practice which Certified Claims Management are experienced at exposing and dealing with. Click here for more information on Bad Faith Insurance Practices.

The Signs of Bad Faith Insurance Settlement Practices:

• An insurer may be acting in bad faith if the insurer delays, discounts or denies payment without a reasonable basis for its delay, discounting or denial.

• Failure of insurer to acknowledge and reply promptly upon notification of a covered claim.

• Failure of Insurer to pay a covered claim as a result of failing to do a proper, prompt and thorough investigation as to reasonable liability and damages based upon all available information.

• Failure of insurer to affirm or deny coverage of claims within a reasonable time upon receipt of claim and/or proofs of loss.

• Failure to offer or attempt to effectuate prompt, fair and reasonable evaluation of damages and equitable settlements of claims to insured within a reasonable time where liability is reasonably clear.

• Insurer attempts to settle a claim for less than the amount to which a reasonable person would have believed was entitled or attempts to substantially diminish a claim requiring an insured to initiate litigation.

• Making payment(s) for claims without accompanying statement indicating the coverage for which payment(s) are being made.

• Failure of insurer to promptly settle claims, where liability and coverage is reasonably clear under one portion of the insurance policy in order to influence settlements of coverage for another portion(s) of the policy.

• Failure of insurer to promptly provide reasonable explanation and basis when denying or making a compromise offer of claim settlement.

• Requesting over burdensome documentation demands not required by the policy.

• Using illegal and fraudulent investigative methods and procedures.

• Using harassing, intrusive or demeaning investigative methods and procedures which victimize the insured.

• Failure of Insurer to make full and satisfactory payment of a first party claim prior to requiring settlement or exhausting the limits of a third-party insurer (i.e. in uninsured motorist cases).

• Unjustified contention and/or "lowballing" regarding the value of a loss.

• Intentionally withhold, misinterpret or misconstrue claims information and/or failure to not inform insured of provisions and covered benefits under the policy pertinent to a claim.

• Attempts to use indiscriminate measures, reference and/or procedures that diminish or reduce the top line amount or value representing full payment of the claim.

• Intentional or irresponsible non-disclosure and withholding of information, misinterpretation of file documents and/or policy provisions, that would be in favor of the claimant.

• Unsubstantiated and unwarranted accusations of arson.

• Wrongful threats not to pay claims.

• Insurer advice to claimant not to hire a lawyer or a Loss Assessor

• Treatment of insureds represented by Loss Assessors as insurer adversaries.

• Treatment of insureds and claimants as adversaries.

• Significant increase in amount of premium as a result of making a claim where insured was not at fault and in conflict with industry standards.

• Cancellation of a policy as a result of making a claim or result of an accident where insured was not at fault and in conflict with industry standards.

• Failure to live up to, conform or comply ABI and FSA standards.

• Using inaccurate or wrongful information of a factual or legal nature to diminish, deny or delay payment of a claim.

• Not being forthcoming with facts regarding coverage to deny, delay or reduce the amount of the claim.

• Using extreme undue persecution, wrongful and victimizing tactics and actions, meant to crush, threaten, thwart, intimidate, oppress, in order to scare away and get the claimant not to make or pursue a claim.

• Changing or altering policy coverage without informing or receiving the consent of insured.

• Biased investigation of that which is supposed to be neutral and unbiased.

• Repeated and constant reference and intentional miscommunication and misrepresentation by insurer downplaying the size of a claim to insured's Loss Assessor.

• The same claims person of an insurer handling conflicting and both sides of the same or related claims.

• Deviating from standard procedures called for in an insurer's claims manuals.

• Abusing and/or misusing the judicial court system in order to delay or settle in good faith payment of a claim where liability to the claim is clear and amount of the claim is reasonable in order to delay insurer's having to make payment of a claim.

• Fraudulently misrepresenting and revealing various conflicting financial information that mischaracterizes the true financial information and status of an insurer.

• Attempting to shift blame and responsibility of investigation to insured and away from the insurer.

• Insurer refusal to settle a third party claim against an insured within the limits of the insured's policy thereby exposing the insured to additional liability.

• Intentionally misinterpreting or misconstruing the law to the disadvantage of the insured and benefit of the insurer.

• Unreasonable misinterpretation of policy language.

• Taking undue excessive advantage of unlimited time when knowing there may be no time limitations established on alleged investigations of such matters or matters of fact.