When you purchase an insurance policy, you do so in good faith, trusting that the insurance company will pay up honestly on valid claims. After all, the purpose of insurance is to protect you against loss in the unfortunate event that illness, injury or a catastrophic event occurs.
But the reality is that buying insurance does not guarantee you benefits in the event you must file a claim. Each year, hundreds of legitimate claims are denied without justification as private insurers seek ways to bolster their profits. The breach of trust that occurs when a claim is unjustly denied is called insurance bad faith. Bad-faith claim denials by insurers can be financially, physically and emotionally devastating for the insured as well as for their loved ones. Although many cases of insurance bad faith involve long-term disability insurance, similar examples can be found among auto, homeowners and business insurers.
Insurance bad faith is when an insurance company:
- unreasonably delays claims;
- underpays, terminates, or denies legitimate claims;
- misrepresents vague policy language in their favor;
- hides benefits from policyholders;
- puts their financial interests before their policyholders;
- forces policyholders to sue them in order to receive their benefits; or
- uses intimidation to discourage or undersettle claims.
Has Your Disability Claim Been Denied?
Insurance companies have an obligation to their consumers to conduct business in a manner that is fair and ethical. If you or a family member has been denied a legitimate claim or have had your long-term disability payments terminated, you may be entitled to compensation. An attorney with experience in dealing with insurance bad faith cases can help you learn more about your rights as a policyholder.
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