Do you know what a bad faith insurance claim is?

Mississippi is an at-fault auto accident insurance state. This means that a motorist who causes an accident must pay any reasonable expenses the other driver incurs from the crash. 

Insurance companies are businesses, however, and they expect to turn a profit just like any other company. One of the strategies they employ to accomplish this is to deny insurance claims whenever possible and withhold benefits that an injury victim needs. This practice is referred to as a bad faith insurance claim

What are the elements of a bad faith insurance claim?

The concept of a bad faith insurance claim is rooted in common law. Some jurisdictions refer to bad faith as any unreasonable actions a party takes without proper cause. Other jurisdictions view finding liability more narrowly. They argue that it should only occur when denying a claim isn’t “fairly debatable.” 

An insurance company is deemed to have acted in good faith when they are fair in dealing with others based on the fiduciary relationship that they have with the insured. Evidence that an insurance company engaged in unfair and deceptive practices can include:

  • Not being timely or providing no clear reason for the denial of the claim.
  • Requiring an insured to file a court case to recover damages.
  • Denying an insurance claim without conducting an investigation.

Any Insurance companies that fail to offer a fair settlement when there’s clear proof of liability may be guilty of bad faith insurance practices as well. 

Are you a victim of a bad faith insurance claim?

Most people don’t know how insurance companies should handle insurance claims. Each jurisdiction has requirements that insurance companies must follow in responding to claims filed, though. Learning more about your rights when an insurance company isn’t playing fair after a wreck can help.