WOULD INSURANCE CARRIERS DENY CLAIMS DUE TO COVID-19 AND NO OTHER JUSTIFICATION?
Yes, it’s possible. The idea aligns with how some insurance adjusters handle claims. Oh, and did I mention that there’s a book on the topic? It’s called “Delay, Deny, Defend: Why Insurance Companies Don’t Pay Claims and What You can Do About It” by Jay M. Feinman. In the legal world, we call this insurance bad faith.
SO, WHAT IS INSURANCE BAD FAITH LITIGATION?
Well, in some situations, insurance bad faith litigation occurs when the insurance company denies a claim for coverage without reasonable justifications. Let’s look at this example: Gary owns a bar and restaurant that gets burned down. Gary makes an insurance claim with his carrier to recover compensation for his loss. The insurance carrier denies the claim. This kind of feels like “bad faith,” especially if the refusal to pay is not predicated upon a reasonable justification. Now, what is important to know is that the burden of proof is on the insured. So, that means the insured must provide evidence to demonstrate that an insurer failed to exercise good faith in the processing of a claim of the insured. Basically, you have to prove that the insurance company did not have a reasonable justification in denying the claim. Insurance bad faith claims are difficult because “a reasonable justification” is a low standard. Let’s say that Gary, above, was having financial trouble; his business took a downturn for the last five years, and he has been trying to sell the business for two to three years. Courts have held that this is a reasonable justification to refuse payment. Because of this low standard, insurance
companies routinely hire private investigators to help them build their case to support a “reasonable justification.” This is why it is important to have someone on your side, fighting for your rights. Insurance carriers have many other tricks to delay, deny, and defend your claims. The other important thing to know is that under Revised Code Section 2315.21(D), the award for bad faith is capped at two times the compensatory (or breach of contract) damages.
HOW CAN WE HELP?
If you suspect your insurer is being unfair or dishonest with you (for example, about the facts of your claim, the value of your claim, or the coverage under your policy), you’ll want to make sure you have the right legal team on your side. This is not something you want to try on your own. By working with our team, you can get the legal advice and guidance you need to determine if you have a case and figure out how to proceed. We will let you know whether your rights have been violated and what to do about it.
LOCAL BUSINESS PROFILE
THEO YANNI’S
Looking for a great restaurant with authentic Greek and American cuisine? Check out Theo Yanni’s in Weirton, West Virginia. During the lockdown, we regularly enjoyed their home-cooked meals — Greek chicken salad, hot stuffed pepper soup, Mediterranean wrap, and kids’ buttered noodles always seemed to hit the spot. Call 304-919-2900 to place an order.
2 | 740-314-4829 This newsletter is for informational purposes only and no legal advice is intended. Be sure to consult with this law firm if you have a specific question about your situation. And, remember Edward and Jeff don’t take any unplanned inbound telephone or in-person meetings. We believe each case deserves our undivided attention.
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