Houston Bad Faith Insurance Attorney
When you take out an insurance policy, you expect the insurance company to hold to the terms of the agreement. It can be incredibly frustrating if you file a claim with your insurance company only to find out that they are refusing to pay – or refusing to acknowledge that you even have an insurance policy.
Insurance companies are often accused of not only violating the terms of the insurance policy but doing so in “bad faith.” This violates legal requirements about how they should handle insurance claims and can often allow claimants to file a lawsuit against them. In court, the judge can enforce the insurance policy and order the insurance company to pay what you are owed.
If you faced unjustified denials and are having trouble getting payouts from an insurance company, you could be the victim of bad faith insurance. Call The Queenan Law Firm’s Houston bad faith insurance attorneys today at (817) 476-1797 to learn more about your rights in a free legal consultation.
What Constitutes “Bad Faith” in an Insurance Claim in Houston?
Whether you are filing a claim with your car insurance company, your homeowners insurance, or some other insurance company, the insurance company has a legal duty of “good faith.” This requirement comes from old common law and requires an insurer to make an honest effort to investigate the claim and pay damages if the claim meets the policy’s requirements. If your claim is for damages that are not covered under the policy or the policy truly does not exist, they do not have to follow this standard.
Unfortunately for many people with valid insurance policies, the insurance company will deny their claim based on completely invalid reasons or made-up technicalities. This often violates the “covenant of good faith and fair dealing” and can lead to a lawsuit against the insurance company. This is distinct from a breach of contract case – which could also come up in an insurance claim if the insurance company refuses to follow the terms of the insurance policy.
Bad faith insurance cases are often more extreme than mere breach of contract cases and often involve the following kinds of underhanded or unfair actions:
- Denying that the policyholder has a policy
- Indefinitely delaying a claim without reason
- “Losing” records that show the policy exists, that premiums were paid properly, that a claim was filed, or that the claim was accepted
- Cancelling a policy while the claim is pending
- Dodging communications and failing to respond to the policyholder’s calls and claims
- Denial of a claim without attempting to investigate
- Changing the terms of the agreement without notice or after the claim has already been filed
- Obvious undervaluing
- Threatening you with violence or frivolous legal action
If any of these things occurred in the course of your insurance claim, you should speak with our Houston bad faith insurance attorneys right away to get help with your case.
What to Do as a Victim of Bad Faith Insurance in Houston
Sometimes insurance companies will fix their mistakes and pay claims when pressed on the issue. This means that hiring an attorney and sending demand letters to the insurance company may be enough to get them to reverse course, accept your claim, and pay it at its full value. However, they have already breached the good faith requirements and may have already caused you harm by delaying your claim. If they refuse to reform their behavior and continue to deny your claim or avoid communications, you could suffer even more harm.
Filing a lawsuit against an insurance company is often the strongest tool to hold them accountable for their bad faith and to enforce the terms of the insurance policy. Judges can hear breach of contract claims and bad faith insurance claims, listen to your arguments, and decide whether the insurance company did indeed breach the terms of the contract or violate their duty of good faith. If the court rules in your favor, the insurance company can be ordered to pay damages.
The court order can include an order to pay the claim as the policy requires, meaning that you could get all damages you were entitled to under your original insurance claim. If you suffered additional damages that would have exceeded policy limits, it is possible that a judge might also rule that the insurance company should pay for these damages – or that they should pay other additional damages as a punishment for their bad faith. Punitive damages are often difficult to claim in court cases, but repeat bad actions by an insurance company or a pattern of bad faith in other cases could justify these damages.
Insurance Bad Faith Vs. Breach of Contract Cases in Houston
As mentioned, an insurance policy is technically a contract between the insurance company and the policyholder. This creates certain legal duties between these parties – such as the policyholder’s requirement that they have to pay monthly premiums and the insurance company’s requirement that they will pay damages under the terms of the policy. The duty of good faith is separate from the actual terms of the agreement and is instead a legal duty about how the insurance company needs to act when approaching claims.
If the insurance company gives reasons for denying a case and uses arguments based on the terms of the agreement to support why they denied a claim, the case might not constitute bad faith. Still, you could be entitled to sue the insurance company for breach of contract and ask a judge to enforce your policy. If you need damages from your insurance claim, your lawyer can help determine which type of claim is appropriate and pursue your case either way.
Contact Our Attorneys for Claims Involving Bad Faith Insurance Denials
If your insurance company denied your claim without a reasonable basis or failed to give a reason for a denial or delay, you could be the victim of bad faith insurance. Call our Houston bad faith insurance lawyers at The Queenan Law Firm today at (817) 476-1797.