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When a person is injured in an accident or suffers property damage, they typically turn to their insurance company (or the insurance company of the responsible party) to compensate them for their losses. While those who have suffered losses surely are counting on the insurance company to pay their claim without issue, things do not always play out this way; indeed, not only are there instances where fault or the extent of damages is disputed, but there are also situations in which an insurance company acts in bad faith.
When an insurance company acts in bad faith, claimants and policyholders have a legal cause of action. At the offices of the Khan Law Firm PLLC, we have experience representing claimants dealing with the bad faith actions of insurance providers, and can help you to understand your rights and legal options.
An insurance company has a legal obligation to process your claim in a manner that is reasonably timely, which includes investigating your claim, processing any information related to your claim, and ultimately paying your claim. It also has an obligation to provide you with accurate information related to your policy and your claim. Further, if a claim is denied, it must be on reasonable grounds.
When any of the above duties are breached, the insurance company is acting in bad faith. The state of Washington’s code, section 284-30-330, provides a comprehensive list of specific unfair claim settlement practices, which includes, but is not limited to;
It is important to note that merely refusing to pay out a claim or disagreeing with a claimant about the amount of damages that they owe does not, in itself, constitute bad faith. Bad faith only occurs when there is an intentional misrepresentation of information, or the insurance company acts in a manner that is unreasonable.
It can be difficult for a claimant to know when an insurance company and insurance adjuster are denying a claim based on legitimate reasons, or are acting in bad faith. It can also be difficult for an individual to know what a “reasonable” amount of time is -should it take two weeks to process a claim, or two months? What about six months, or more? Further, if a claim is denied, is it per the terms of the policy, and a result of lawful reasons, or is it simply because the insurance company did not want to pay out the claim?
If your claim is taking what seems like an unreasonably long time to process, or if you have been denied benefits that you believe you deserve, calling an experienced attorney is a must. An attorney who is knowledgeable in bad faith insurance practices can assess your situation and make a determination regarding whether or not bad faith insurance practices are occurring. If so, your attorney can advise you regarding what steps to take next.
If an insurance company is acting in bad faith, you maintain the right to pursue a case against the insurance company for damages. A statutory case claims that the insurance company committed an act prohibited by Washington statute (i.e. failed to adopt and implement reasonable standards for the prompt investigation of a claim). However, you may also bring forth a common law complaint, which alleges that you were due benefits per your policy, those benefits were withheld, and the reason for benefits being withheld is unreasonable. Pursuing an action against an insurance company that denied your claim in bad faith allows you to seek compensation. Typically, if your case is successful, the insurance company will be obligated to pay you the compensation that you deserved for the original claim (which was denied, spurring the bad faith claim). In many cases, you may also be able to recover attorneys’ fees and litigation expenses.
Like all types of lawsuits and civil actions in Washington, there is a limit on the amount of time a party has to act after an act of bad faith occurs. However, the specific time limit for bad faith insurance claims depends upon whether the claimant’s cause of action is based on a breach of contract or a bad faith claim. It is absolutely critical to work with an attorney who can review your options for bringing forth a claim based under contract law or tort law, and can advise you regarding how much time you have to act.
When you have been involved in an incident that results in any economic or noneconomic damages, you deserve to be compensated for those losses. Whether seeking damages through your own insurance company or the insurance company of an at-fault party, an insurance company has a duty to ensure your claim is investigated, processed, and paid within a reasonable amount of time. While insurance companies are not legally obligated to pay out all claims or honor claimants’ damages demands, companies can only deny claims when they have legitimate and reasonable reasons for doing so.
Having an attorney on your side when pursuing compensation from an insurance company improves the odds that you will be awarded your full compensation amount – insurance companies often take advantage of claimants when they think they can get away with it; having an attorney on your side makes you a stronger opponent who is often not worth fighting.
If you are denied benefits you believe you deserve or your insurance company acts in bad faith, your attorney will go to work on your behalf to investigate the alleged act of bad faith and determine whether or not you have a case. If you do, your lawyer will work hard to ensure that you recover 100 percent of the damages you’re owed.
At the Khan Law Firm PLLC in Seattle, WA, we have years’ worth of experience representing victims of bad faith insurance practices in Washington State. To schedule a free consultation with our law offices with no obligation to hire our legal team, please call us today or send us an email using the intake form on our website.