Santa Ana Insurance Bad Faith Attorney
Policyholders pay premiums with the expectation that their insurance carriers will protect them from financial burden or ruin caused by natural disasters, fires, accidents, and sickness. Unfortunately, this isn’t always the case. Some insurance carriers engage in poor and illegal business practices legally referred to as acting in bad faith. Insurance companies are not legally required to approve each claim and often have legitimate reasons to deny a claim. Yet circumstances exist when a policyholder might suspect the insurance company is not handling a claim in a fair manner.
If you suspect your insurance carrier has unfairly denied or processed your claim, engaged in fraudulent business practices, or won’t communicate with you, hire a Santa Ana insurance bad faith attorney to represent you and hold your carrier accountable. Contact Aitken * Aitken * Cohn at (866) 434-1424 to discuss the details of your case.
Aitken * Aitken * Cohn’s Results in Insurance Bad Faith Cases
The award-winning legal team at Aitken * Aitken * Cohn has extensive experience representing clients in a wide variety of personal injury cases, including insurance bad faith claims. Our personal injury lawyers in Santa Ana are committed to excellence, which shines through with their continued dedication to client service. Aitken * Aitken * Cohn’s lawyers have not only been recognized by their peers through organizations such as Super Lawyers, Best Lawyers in America, and Martindale-Hubbell but also enjoy a reputation as skilled negotiators and litigators among past clients. In their decades of serving clients in Southern California, Aitken * Aitken * Cohn’s legal team has secured millions of dollars in settlements and verdicts for clients. This does not guarantee a result in any particular case, but you can nonetheless expect Aitken * Aitken * Cohn to diligently pursue the best outcome for your situation. In addition to investigating your bad faith case, and gathering relevant documents, your injury attorney can handle communications with the insurance company to ensure the best chances of holding them accountable.
Types of Bad Faith Insurance Claims in California
Many different events might cause a person to file an insurance claim, some specific to California. Here are examples of claims that might give rise to a bad faith action against an insurance carrier:
- Storm damage and flood insurance claims
- Earthquake damage claims
- Mudslide damage claims
- Fire damage claims, including those from forest fires
- Motor vehicle accident and damage claims
- Disability claims
- Health insurance claims
- Life insurance claims
“In California, insurance cases involving property damage under $12,500 are typically handled in small claims court, a venue where parties generally cannot be represented by attorneys. While a wide range of actions can lead to bad faith liability, water damage, and homeowner’s insurance cases are among the most common inquiries our firm receives. At Aitken Aitken Cohn, we focus on catastrophic and significant property damage loss cases, particularly those involving repair or replacement costs exceeding $200,000 in damages.”
First Party versus Third Party Insurance Claims
Under California law, insurance companies must engage in fair claims settlement practices regardless of whether the policyholder or another party makes the claim. When an insured person makes a claim under their contracted insurance policy, this is a first-party claim. The vast majority of bad faith claims in California, and most states, are first-party claims, and usually stem from unreasonable denials, inadequate or improper claims processing and investigation, or delayed payment. Your insurer has the right to gather as much evidence as they need to process your claim, and you have the obligation to cooperate and answer questions about your loss; however, you need not cooperate with harassing behavior or unreasonable requests.
Claims made by other parties are referred to as third-party claims. The most common example of third-party claims occurs under liability insurance coverage. When an accident occurs at a business or at a person’s home, the injured party might file a claim with the at-fault party’s insurance carrier. This also applies to product liability claims and motor vehicle accidents. Yet, California courts rarely recognize third-party claims unless an insurance carrier won’t accept a reasonable settlement within the policy limits.
California Fair Claims Settlement Regulations
California law (Title 10, Chapter 5, Sub-chapter 7.5, Section 2695.7) clearly outlines unfair settlement practices. Insurance companies who engage in any of the following activities might be liable for damages in an insurance bad faith lawsuit:
- Discrimination during the settlement process on the basis of age, race, gender, income, religion, language, sexual orientation, ancestry, nationality, or disability
- Failure to process a claim within 40 days of the event related to the claim, or to give written notification when the company needs additional time
- Failure to provide a written explanation for denying a policyholder’s or third-party claim, and to inform claimants of their right to have the matter reviewed by the California Department of Insurance
- Failure to conduct a fair and objective investigation
- Delayed payment or claim denial to the policyholder because another party has the responsibility to pay
- Failure to provide written notice of statute of limitation associated with claim denial 60 days prior to the expiration
- Making an unreasonably low settlement offer
- Delaying payment longer than 30 days after accepting a claim
- Informing a claimant of their loss of rights if they don’t complete a form or release by a certain time, outside of information concerning statutes of limitations
- Requesting a polygraph examination, unless authorized in the contract
- Denying a claim based on a personal interview or telephone conversation
- Seeking recovery of funds paid for medical benefits by claiming they were excessive or unnecessary, except in the case of a fraudulent claim
- Requesting a medical examination to determine liability when the examination is not reasonably necessary
- Requiring a claimant to rescind, withdraw, or withhold a complaint to the California Department of Insurance
- Failure to provide written notification when pursuing subrogation of the claim or share recovery with the first party claimant
Steps to Take if You Suspect Your Insurance Company Is Acting in Bad Faith
If you needed to file an insurance claim because of a loss, you are likely going through a difficult time. An insurance company that isn’t processing your claim appropriately or has denied your claim unreasonably only compounds the matter. You might not know where to start. Here are some steps you can take if you think your insurance company has been acting in bad faith:
- Write a letter. Send your insurance company a professional, but firm, a letter describing the issues you’re having with your claim. Remind them of their legal obligation to handle your claim fairly and in a timely manner. Make sure to keep a copy for your records; you might need it later on.
- Request decision in writing. If your carrier has denied a claim, request the adjuster to provide a written explanation of the decision. Not all denials constitute a bad faith claim, but having the decision in writing will benefit you if you need to file a lawsuit. Under California law, your carrier is required to honor this request. As previously mentioned, failure to do so is a violation of California’s Fair Claims Settlement Regulations.
- File a complaint. Contact the California Department of Insurance and file a complaint against the insurance company. You can visit their website, or call their helpline at 1-800-927-4357.
- Contact your agent. Sometimes an agent or broker isn’t aware of the issues you are having with the insurance company. If you contact your agent and divulge your problems, your agent might be able to alleviate the situation. You might find a reasonable explanation for delays related to processing your case or issuing payment, and your agent might have contacts to get your claim moving.
- Consult with a lawyer. Sometimes getting a lawyer involved is the only way to make your voice heard by an insurance company. Talk to an experienced insurance bad faith lawyer who can inform you of your rights and advise you on the best path for your situation.
Recovering Compensation From a Bad Faith Insurance Claim
If you sue an insurance carrier for bad faith, and the court rules in your favor, you might receive compensation for the following:
- Claim amount, plus loss. It’s likely the insurance company will have to pay you the initial claim amount to cover the loss from the event which led to the claim. This might be a personal injury claim, medical benefits claim, workers’ compensation, homeowner’s insurance claim, commercial business claim, or any other type of insurance claim. The company might also have to pay for any additional financial loss you incurred as a result of their actions.
- Mental anguish. When insurance companies act in bad faith, they cause emotional stress to victims, especially added financial stress. You might receive additional money to compensate you for this distress if the court rules in your favor.
- Legal expenses. If the court rules in your favor, it is likely they will make the insurance company pay your attorney fees, court fees, and any other fees associated with your lawsuit.
- Punitive damages. Courts hesitate to award punitive damages except in cases of gross negligence or intentional harm. An insurance company’s intentional misdeeds might warrant punitive damages in a court’s eyes if your attorney can prove the carrier acted fraudulently, or with oppression or malice. Your attorney can advise you on the likelihood of receiving punitive damages in your particular circumstances, and perhaps provide some examples of similar cases to give you a better idea of what might be in store for you.
Insurance Company Defenses to Bad Faith Claims
Insurance companies like to avoid making large payments at all costs, but especially when they are accused of wrongdoing. If you are considering filing a lawsuit against an insurance company for bad faith, expect their legal team to aggressively defend their actions. Some defense strategies you might experience include:
- Statute of limitations expiration. California courts generally view insurance bad faith claims as torts, so this means you must take legal action within two years of discovering the carrier’s misconduct. Some jurisdictions, however, view bad faith as a violation of contract law, extending the statute of limitations to four years. It’s best to take legal action as soon as possible, so the defense cannot argue that your statute of limitations expired. Your attorney will advise you on which statute applies to your case.
- Breach of contract. The defense might argue the insured did not comply with all aspects of the contract. This typically isn’t a strong defense against bad faith actions, but it doesn’t mean the insurance company won’t try to make this argument.
- Lack or lapse of coverage. If a third party makes a claim, the defense might argue the party had no coverage with them. In first-party claims, the insurance company might argue the insured didn’t pay their premiums, so there was a lack of coverage during the relevant event.
- Waiver of release. In some cases, the policyholder might sign a waiver of release, assigning the bad faith claim to a third party. This might occur when an insurance company rejects a settlement offer and the insured wants to protect assets from judgment. The defense might argue, the release removed the cause of action against the insurance carrier.
- Election of remedies. Depending on the circumstances, your lawyer can proceed with a tort or a breach of contract action when bad faith occurs. In many situations, attorneys proceed with both actions. The defense might argue the plaintiff waived the right to a tort claim when suing for breach of contract. Your attorney will discuss which remedy is appropriate for your case, or advise you to proceed with both.
Hire an Experienced Santa Ana Insurance Bad Faith Lawyer to Hold Your Insurance Carrier Accountable
Insurance policies are complex documents with ample fine print and insurance companies have large legal teams ready to fight against any claims of wrongdoing. Whether you are a policyholder or a third party making a claim, you deserve to be treated fairly. If you suspect the insurance company with which you are dealing has been acting in bad faith, do not fight alone. Hire a seasoned Santa Ana Insurance Bad Faith attorney who understands bad faith claims and will aggressively negotiate a settlement for you, or go to trial when settlement isn’t an option. Lawyers who have experience with bad faith claims know the defense strategies insurance companies employ and how to fight against them.
Contact the experienced insurance bad faith lawyers at Aitken * Aitken * Cohn at (866) 434-1424 or email us to learn how we can help you hold your insurance company accountable for their unscrupulous decisions. If you choose us to represent you, we handle these cases on a contingency fee basis, collecting our attorney fees only from any settlement or court-awarded damages you receive.