Your insurance company could be acting in bad faith when it denies payment of your valid property damage or auto insurance claims, unreasonably delays payment or underpays your valid claims without good reason, or does not timely or thoroughly investigate your claims.
Our lawyers handle insurance bad faith cases on behalf of individuals and businesses with insurance coverage issues.
Key Elements Required to Prove Bad Faith
Under Louisiana law, your insurance company owes you a duty of good faith and fair dealing in the adjustment of your homeowners and auto insurance claims. This duty of good faith and fair dealing also includes a duty on the part of the insurance company to verify whether any part of your claim for damages is excluded from coverage. If your insurance company breaches its duty and acts in "bad faith," it may have to pay you penalties, damages and/or attorney's fees, in addition to the amount it owes you under your insurance policy.
In Louisiana, to show that your insurer acted in bad faith, you must prove that: (1) your insurer received satisfactory proof of loss; (2) the insurer failed to pay your claim within the time period allowed by law; and (3) the insurer's failure to pay was arbitrary, capricious or without probable cause.
The phrase "satisfactory proof of loss" simply means that your insurer must receive sufficient information to act on your claim. A personal inspection of your property by an adjuster for the insurance company is usually considered satisfactory proof of most losses.
The phrase "arbitrary, capricious or without probable cause" means that your insurance company's failure to pay your claim was unjustified or lacked a reasonable basis or excuse. If your insurer is found to have acted in bad faith, it may owe you for certain damages caused by its bad faith conduct, in addition to penalties and attorney's fees.
Bad Faith Claims Frequently Arise in the Context of:
- Property damage claims caused by fire, storms or hurricanes
- Uninsured and underinsured motorist personal injury claims
- Claims for medical payment or damage to your vehicle under your automobile insurance policy
- Mold claims
Your insurance company's duty of good faith and fair dealing is separate and apart from its obligation to pay for your insured losses. Your insurer's obligation to pay for certain losses is imposed by your insurance policy, whereas the duty of good faith and fair dealing is imposed by law. Therefore, to make a claim against your insurance company for bad faith, you typically must file a lawsuit.
Signs of Bad Faith
- Failing to promptly investigate your claim
- Unreasonably delaying payment of your claim
- Refusing to pay the full amount of your claim
- Delaying your claim by sending out multiple adjusters to inspect your property
- Paying a fraction of the repair cost estimated by your contractor or repairman
- Refusing to pay all or part of your claim based on unreasonable policy interpretations
We have successfully represented more than 1,000 individuals and businesses for property damage and auto insurance claims. If you would like us to review your potential bad faith claim, please call our New Orleans area office today at 877-852-3688 to schedule a free initial case evaluation.