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Having an adequate insurance policy can provide you with a sense of relief and comfort after a flood, fire, hurricane, or other natural disasters. A critical part of any insurance policy is the understanding that if your property is damaged or you suffer a loss, your insurance company would act in good faith when you file a claim.

When insurance companies act in bad faith, it can mean you are left with unresolved property damage and loss. However, by filing a bad faith insurance claim you may be entitled to recover compensation for the settlement you should have received as well as additional compensation for further losses.

A Raleigh bad faith insurance lawyer approaches each bad faith insurance claim by examining the individualized facts surrounding the insurance contract and the insurance company’s actions or inactions. If you feel your insurance claim was unfairly denied, it may be worthwhile to speak to a qualified insurance attorney about your options.

What is a Bad Faith Insurance Claim?

Under North Carolina’s Unfair and Deceptive Practices Act, bad faith is recognized as a breach of contract when accompanied by some tortious conduct. Bad faith is interpreted to mean that an insurance company has not had an honest disagreement or made an innocent mistake when dealing with a claim.

A bad-faith insurance claim occurs when an insurance company fails to pay after recognizing a valid claim and then engages in aggravating or outrageous conduct. If a policyholder believes their provider rejected their insurance claim in bad faith, it is usually critical to prove that the insurance company has engaged in some willful, wanton, and/or conscious disregard for their obligations as defined by the policy in question.

Common Examples of Bad Faith Claims

Bad-faith insurance claims are especially troublesome due to the complications that come with trying to reach an agreement with an insurance company. Some common bad-faith practices include:

  • Failing to investigate a case
  • Intentionally delaying payment
  • Failing to provide a reasonable explanation for a denial
  • Using unreasonable interpretations of a policy
  • Failing to reimburse fully

Failing to Investigate a Case

If an individual makes a claim under their insurance policy following a natural disaster, their insurance company has an obligation to investigate the claim. Insurance companies may engage in bad faith by either failing to send an adjuster or simply rubber-stamping a claim and not thoroughly investigating.

Intentionally Delaying Payment

After a fire, flood, hurricane, or other natural disaster, individuals are often pressed to make repairs, making prompt payments from an insurance company potentially critical to their financial well-being. However, insurance companies may engage in bad-faith practices by delaying payments.

Failing to Provide a Reasonable Explanation for a Denial

If an insurance company denies a claim, they have an obligation to provide a reasonable explanation. An explanation should indicate the steps they took to investigate the claim, explain and attach the insurance policy, and explain the basis for a denial.

Using Unreasonable Interpretations of a Policy

An insurance policy is a contract, and the terms of the policy must be fully set out within the policy. While these terms are open to reasonable interpretation, insurance companies could try to twist the plain language of a policy to avoid paying.

Failing to Reimburse Fully

An insurance company may engage in bad faith by failing to fully reimburse an individual for their losses. Insurance companies may also act in bad faith by failing to abide by the language of the policy itself, such as when a person has full coverage for an accident but an insurance company tries to unnecessarily line-item expenses.

Contact a Raleigh Bad Faith Insurance Attorney

When you work with the insurance company that oversees your policy, they have an obligation to treat you and your claim fairly. If your insurance company or another party’s insurance company has engaged in bad faith, it can leave you left with unresolved property damage, loss, and facing financial losses. If you have questions or concerns about whether your insurance company or another person’s insurance company has engaged in bad faith practices, contact a Raleigh bad-faith insurance lawyer today.