When you file an insurance claim, you expect fair treatment by your insurer and prompt resolution of your claim. Unfortunately, it’s not always the case. You may encounter challenges when seeking compensation or settling your claim, which can be frustrating.
Fortunately, the law protects you from unfair insurance practices, and identifying them can empower you to respond appropriately to protect your rights. Below are some of these common bad-faith tactics.
1. Unreasonable delays
The insurance company may repeatedly ask for unnecessary documentation or fail to respond to your inquiries in a timely manner. While it’s reasonable for insurers to request evidence to process a claim, excessive or redundant demands can be a stalling tactic designed to frustrate you into settling for less than you deserve.
2. Denying your claim without justification
If your claim is denied, the insurer is legally obligated to explain the reasons behind the denial. This explanation should reference specific terms or conditions in your policy that support their decision. Denying a claim without justification is a sign of bad faith practices by the insurance company.
3. Misrepresenting policy terms
Your insurer may intentionally distort, misinterpret or omit key details of your policy to justify denying or underpaying your claim. For example, they might tell you that a particular loss isn’t covered, even though your policy includes it, or falsely claim that you missed a deadline for filing your claim.
Such dishonest actions could be aimed at limiting their payout or shifting the burden onto you, and you shouldn’t take it lying down.
What can you do about it?
If you suspect your insurer is engaging in bad faith tactics, document all communication, gather evidence and seek legal guidance. Remember, you are entitled to a fair settlement of your insurance claim, and you should not be afraid to assert your rights.