All insurance companies have a standard protocol regarding personal injury claims. They are required by law to investigate all claims in a timely manner, but the unfortunate reality is that each company’s protocol is designed to benefit the company at the expense of the injured claimant. In this sense, the insurance company will almost always search for evidence that can be used to deny a claim, or at the very least, paying an injured individual the least amount of money they will settle for.
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This is especially true when the claims adjusters think the claimant will not retain legal counsel. All insurance company claim inspectors understand the law with respect to bad faith, and typically skirt right along what is allowable that would not be obviously illegal tactics.
Acting in good faith is required by insurance companies during the negotiation and settlement phase of a claim process as well. An experienced personal injury attorney will understand common bad faith insurance practices and know how to help ensure that the insurance company handling your claim is acting in good faith.
1. Failure to Disclose Policy Details
- Insurance companies are not typically quick to divulge the level of insurance protection a negligent client may carry. They will often look at a case, and make a quick low-level offer to settle the claim with a full release of future medical coverage. This is not only a sure sign to contact a personal injury attorney, but it could be grounds for a bad faith claim that can be filed in addition to the original injury claim.
- All legal actions should be submitted by a seasoned bad faith insurance attorney who understands how companies can abuse claimants by not fully providing information regarding a potential claim value.
2. Failure to Investigate in Accordance With State Law
- Insurance companies are usually very prompt when investigating a claim, but many times they will stop at the point they think they have found evidence that exonerates them from responsibility to pay benefits. The most common example of this type of failure would be determining fault in an auto accident case.
- In states like Illinois that implement modified comparative negligence law, a comparative negligence percentage of 51% would nullify an injured driver's claim for benefits. This means that a 50-50 two-car accident would result in each driver receiving half of their total injury damages, but even a slight increase could give the insurance company the power to deny a claim completely.
- This potential gives insurance companies ample incentive to force a claim to court, as the jury makes the final determination in fault, but it could also be a bad faith issue as well when the accident is not properly investigated.
3. Unfair Claim Denial
- All insurance companies have the legal authority to require a case be heard in court. However, this could be bad faith when the claim is clearly valid on its face. Even cases of clear fault can wind up in court when the insurance company wants to be difficult in hopes of a reduced benefit payout assigned by a jury.
- An aggressive auto accident attorney can investigate the claim thoroughly, and they can use evidence that the insurance company knew beforehand to show that the claim should have been paid without the unnecessary delay and expense of requiring the claimant to take the case to court for whole compensation.
- This happens more often than people realize, and a comprehensive attorney understands how to craft the case in a manner that forces the insurance provider to pay an equitable amount based on their actions.
4. Offering Unreasonable Settlement Offers
- Many insurance companies have a "take it or leave it" policy towards claim settlement. Sometimes this occurs quickly when they think they can avoid dealing with an accident attorney, but many times it results in an official court hearing. The hearing gives your attorney an opportunity to compare the offer with other settlements similar to your claim and pinpoint the obvious discrepancies between amounts.
- This component of the court record can then be used to establish standing for an additional bad faith claim against the company. Many injured claimants who attempt handling their own claim take the first or second offer thinking that is all of the compensation available, but an experienced bad faith attorney can keep insurance providers honest.
5. Intentional Delaying of a Claim Payment
- Probably the most common form of bad faith insurance company tactics is intentional claim delays at all junctures of the negotiating process. Each step in the procedure can take time, and many insurance companies take as much time as allowed when the claim is significant. An argument over claim values is not unusual, even in valid instances, and needless extensive negotiation on simple issues could be determined an abuse of legal power in a claim evaluation.
- Insurance companies will often "hold out" from paying a claim in hopes the claimant will agree to a lower amount out of dire necessity. This is common for many who do not have legal counsel, and it is often a sign of bad faith on behalf of the insurance company.
These principles in an insurance claim procedure are the exact reasons why an injured victim should always retain legal counsel when filing an injury claim. Insurance companies are primarily obligated to their own client and will most likely do everything in their power to pay as little as possible to an injured party.
If you’ve been injured in the Chicago area, make sure your rights to fair and full compensation are protected. Contact Panio Law Offices at (708) 928-8680 for a free consultation to discuss your case.