Insurance Coverage/Insurance Bad Faith Questions
What does the insurance “bad faith” mean?
In Florida, “bad faith” refers to an unreasonable or unfair conduct by an insurance company. Insurance bad faith cases typically arise when a liability insurer refuses to pay their policy limits to a claimant when it is clear that the claimant’s case has a potential jury value equal to or in excess of the insurance policy amount. Consequently, their policyholder or insured gets sued, and when a jury returns a verdict in excess of the policy amount, the policyholder or insured becomes personally liable for the amount over the policy limits. The policyholder may then have a potential bad faith case against its own insurance company for failing to protect him or her from the personal liability.
What are some examples of bad faith conduct?
Some examples of insurance bad faith include:
- Failure to promptly investigate or perform due diligence
- Failure to act within a reasonable time
- Denial or delay of a claim without reason
- Undervaluing or underpaying a claim
- Delay in payment while waiting on a settlement with a third party insurer
- Cancellation of insurance policy unjustly
What about insurance coverage issues in an automobile accident?
For answers regarding automobile insurance, click here.