Unfair Claims Settlement Practices Insurance Companies Are Not Allowed To Engage In

Irvine Insurance Bad Faith Lawyers For Unreasonable Denial Of Insurance Benefits

If you or a loved one received a denial of your benefits claim that you feel was unreasonable, it is possible that the insurance company acted in bad faith. Insurance carriers must uphold a standard of good faith and fair dealing when handling any claim made by their policy holders. If they broke this standard, you might be entitled to receive your benefits and additional compensation through an insurance bad faith lawsuit.

Unfortunately, policyholders who blindly trust insurance companies may be tricked into thinking, or otherwise convinced that they did something wrong in the claims process or that they did not have benefits to cover a particular claim. Insurance companies can, and do make mistakes, but sometimes what may appear to be a mistake may actually be illegal policies and practices that are geared towards favoring the insurer.

2009 California Insurance Code – Section 790.03, Article 6.5. Unfair Practices

Pursuant to California insurance law insurance companies are not allowed to knowingly commit or perform with such frequency as to indicate a general business practice any of the following unfair claims settlement practices:

(1) Misrepresenting to claimants pertinent facts or insurance policy provisions relating to any coverages at issue.

(2) Failing to acknowledge and act reasonably promptly upon communications with respect to claims arising under insurance policies.

(3) Failing to adopt and implement reasonable standards for the prompt investigation and processing of claims arising under insurance policies.

(4) Failing to affirm or deny coverage of claims within a reasonable time after proof of loss requirements have been completed and submitted by the insured.

(5) Not attempting in good faith to effectuate prompt, fair, and equitable settlements of claims in which liability has become reasonably clear.

(6) Compelling insureds to institute litigation to recover amounts due under an insurance policy by offering substantially less than the amounts ultimately recovered in actions brought by the insureds, when the insureds have made claims for amounts reasonably similar to the amounts ultimately recovered.

(7) Attempting to settle a claim by an insured for less than the amount to which a reasonable person would have believed he or she was entitled by reference to written or printed advertising material accompanying or made part of an application.

(8) Attempting to settle claims on the basis of an application that was altered without notice to, or knowledge or consent of, the insured, his or her representative, agent, or broker.

(9) Failing, after payment of a claim, to inform insureds or beneficiaries, upon request by them, of the coverage under which payment has been made.

(10) Making known to insureds or claimants a practice of the insurer of appealing from arbitration awards in favor of insureds or claimants for the purpose of compelling them to accept settlements or compromises less than the amount awarded in arbitration.

(11) Delaying the investigation or payment of claims by requiring an insured, claimant, or the physician of either, to submit a preliminary claim report, and then requiring the subsequent submission of formal proof of loss forms, both of which submissions contain substantially the same information.

(12) Failing to settle claims promptly, where liability has become apparent, under one portion of the insurance policy coverage in order to influence settlements under other portions of the insurance policy coverage.

(13) Failing to provide promptly a reasonable explanation of the basis relied on in the insurance policy, in relation to the facts or applicable law, for the denial of a claim or for the offer of a compromise settlement.

(14) Directly advising a claimant not to obtain the services of an attorney.

(15) Misleading a claimant as to the applicable statute of limitations.

(16) Delaying the payment or provision of hospital, medical, or surgical benefits for services provided with respect to acquired immune deficiency syndrome or AIDS-related complex for more than 60 days after the insurer has received a claim for those benefits, where the delay in claim payment is for the purpose of investigating whether the condition preexisted the coverage. However, this 60-day period shall not include any time during which the insurer is awaiting a response for relevant medical information from a health care provider.

At Donahue & Horrow, L.L.P., our insurance bad faith attorneys have more than five decades of combined experience representing clients through a wide range of insurance disputes. When attempting to resolve a dispute with your insurance company, it is important to seek the counsel of an experienced lawyer. These types of cases can be complex and frustrating, but we focus the majority of our insurance law practice on this type of claim.

Get The Help You Need — Contact an Irvine Insurance Bad Faith Attorney Today

Every insurance policy in California carries an implied covenant of good faith and fair dealing. The insurance company must perform several duties when handling benefits claims, including to:

  • Promptly investigate the insured’s claim;
  • Timely respond to the insured’s inquiries and otherwise communicate with the insured;
  • Contact and speak with the insured’s treating physicians.

When these, or other, acts of good faith are not upheld, it is important to hold your insurance company responsible for its actions. Contact our firm to discuss your case through a free consultation.

To learn more about how our attorneys can help you, schedule a free consultation today. We represent clients in Irvine, Los Angeles and other communities throughout Southern California. Call us at 877-664-5407 or contact us online to schedule an appointment.