How to File a Bad Faith Insurance Claim

Published on: 10/18/23 — In 

To file a bad faith insurance claim, you need to be informed and organized. Bad faith insurance happens when an insurance company refuses to pay benefits without a valid reason.

Gather evidence and create a timeline of events. Include communication with the insurance company, medical records, and incident-related bills. Write a formal letter to the insurance company explaining their bad-faith actions. Attach supporting documents. Research your state's laws and gather more evidence if needed. Keep detailed records of all communication.

If you need assistance with filing a bad-faith insurance claim, call our experienced bad-faith insurance attorneys at Ktenas Injury Lawyers today!

Understanding Your Rights as an Insured

Policyholders should understand their rights when filing a bad-faith insurance claim. Knowing the terms of the policy is crucial to understanding the rights and responsibilities of both parties.

Chris Ktenas, Chicago bad-faith insurance lawyer

Communicating with the insurer and providing evidence is important if bad faith is suspected. If the claim is still denied, seeking legal help may be necessary to navigate the legal process and understand the next steps.

What Your Insurance Contract Entails

Understanding your insurance contract is crucial when filing a bad-faith insurance claim. It outlines the terms, conditions, and coverage provided. Look for provisions in the contract that allow for a bad faith claim and specify the process and potential damages. Knowing the contract details helps you decide whether to file a claim. If you're unsure, seek clarification.

If an insurance company refuses to pay a valid claim in bad faith, the policyholder has legal remedies. A bad faith claim can be made if the insurer didn't promptly investigate or resolve the claim, mishandled the claim, disregarded the claimant's rights, or wrongfully denied coverage.

The most common remedy for a bad faith insurance claim is monetary damages. These damages compensate the policyholder for losses caused by the insurer's actions.

Punitive damages may also be available if the insurance company acted maliciously or in bad faith. Policyholders may also be able to recover legal costs and attorney's fees.

Investigating the Merits of Your Claim

If you think your insurance company is acting in bad faith, investigate. Bad faith claims can involve refusal of payment or inadequate investigation. First, check with a law firm if your claim is valid. Consult an insurance law attorney if necessary.

an insurance claim form on a table

Once confirmed, review your policy and gather evidence such as bills, estimates, and photos. Keep records of all communication with your insurer as potential evidence.

Gathering Evidence to Support Your Claim

To file a bad-faith insurance claim, gather evidence like emails, letters, photos, and medical records. This evidence helps strengthen your case and is necessary for court. Keep copies of all correspondence with the insurance company. Save any documents you send or receive. If you have photos of damages, keep them and provide copies. Lastly, keep bills and receipts for medical expenses or other costs. These documents support the amount you claim.

Analyzing the Type of Claim & Original Claim

If you believe your insurance provider has wrongfully denied or delayed your claim, it may be possible to file a bad faith insurance claim by understanding the type of claim and analyzing the original claim.

Type of Claim:

Before filing a bad faith lawsuit insurance claim, determine what type of claim is at issue. Bad faith claims can involve life insurance, health insurance, auto insurance, homeowners insurance, business insurance, and more.

Original Claim:

Next, review the original claim to determine why it was denied. Many bad faith claims are rejected because the insurer believed that the policyholder was not eligible for coverage or did not follow proper procedures. Other times a claim may be rejected due to the insurer’s interpretation of the policy language.

Determining if You Have a Valid Claim that is Being Denied in Bad Faith

Determining if your insurance claim is being denied in bad faith can be difficult. Bad faith insurance occurs when an insurance company fails to honor its obligation and denies, delays, or limits your coverage. To protect your rights, it's important to understand what constitutes a valid claim and how to determine if your claim is being denied in bad faith.

a keyboard button with the word "insurance" written on it

A valid claim is one where the policyholder meets all the coverage requirements and the insurer fails to fulfill its contractual obligations. To determine if your claim is being denied in bad faith, review your insurance policy and applicable laws in your state.

When filing a bad-faith insurance claim, it is important to take several steps to prepare for potential legal action.

First, understand the legal concept of bad faith and its application to your situation. Bad faith claims arise from an insurance company's failure to act in good faith during the handling or response to an insurance claim. Review the insurance policy and relevant state laws to know your legal entitlements and obligations. This knowledge will help you identify if your claim is being wrongfully denied.

Once you confirm the validity of your claim,  prepare for potential legal action by researching bad-faith lawyers, gathering evidence, and familiarizing yourself with relevant statutes and court decisions.

Choosing an Experienced Attorney Skilled in Bad Faith Claims

When filing a bad-faith insurance claim, it is advisable to seek assistance from a qualified attorney with knowledge in this specific area of law. Engaging an experienced attorney will help safeguard your rights and ensure proper handling of your case. Before selecting an attorney, it is crucial to conduct thorough research, including reading reviews, seeking referrals, and reviewing their background and experience.

Calculating Economic and Non-Economic Losses

When filing a bad faith insurance claim, it is necessary to understand the process of calculating economic and non-economic losses. Economic losses consist of expenses like medical bills and lost wages resulting from an injury or property damage caused by the negligent party.

different types of insurances written on paper

Non-economic losses encompass intangible consequences such as pain and suffering, loss of companionships, or diminished quality of life due to an injury or property damage.

Filing a Complaint and Starting Litigation Against the Insurer

To pursue a bad faith insurance claim, start by filing a complaint against your insurer. Include documentation of the policy and any agreements with your insurer, along with an explanation of their bad-faith actions. After filing, you may be asked to participate in mediation with your insurer. Both parties will try to negotiate a settlement. If no agreement is reached, litigation may be necessary.

Documenting Breach of Contract, Fair Dealing, Emotional Distress & Punitive Damages

Documenting Breach of Contract:

When filing a bad faith insurance claim, document any breach of contract by the insurance company. This includes failure to honor policy provisions or provide coverage as outlined. It may also include failure to act in good faith or use deceptive practices. Keep records of all correspondence to document breaches.

Documenting Fair Dealing:

To prove good faith, document any fair dealing from the insurance company. Keep records of all correspondence.

Documenting Emotional Distress:

When filing a bad faith insurance claim, document any emotional distress caused by the insurer’s conduct, including pain and suffering or mental anguish. Keep records of medical bills or mental health visits resulting from the insurer’s conduct.

Documenting Punitive Damages:

When filing a bad-faith insurance claim, document any extreme or outrageous behavior by the insurance company, such as intentional infliction of emotional distress, fraud, or malicious behavior towards the insured. Keep records of all correspondence with the insurer to document any extreme or outrageous behavior.

How Insurers Respond to a Complaint & Litigation Process

When filing a bad faith insurance claim, it's important to understand the insurer's response and the litigation process. Insurers may deny coverage, offer inadequate compensation, delay payments, or refuse to honor the policy.

To start the litigation process, the insured party files a complaint against the insurer, including relevant documentation and an explanation of the insurer's bad faith actions. The insurer can respond by offering a settlement or going to court. If the case goes to court, both parties present arguments and evidence, and the judge makes a decision.

Speak to an Experienced Bad Faith Insurance Attorney Today!

If you think your insurance company is acting in bad faith, contact our experienced bad-faith insurance lawyers at Ktenas Injury Lawyers for a free consultation.

We have the legal skills to handle bad-faith insurance claims and help you get the compensation you deserve.