What does the phrase “Insurance Bad Faith” mean?

insurance bad faith

24 Jul What does the phrase “Insurance Bad Faith” mean?

An insurance company has a legal obligation to act in good faith when you file an insurance claim. This means that insurance companies must reasonably investigate and promptly pay a covered claim. If you believe your insurance company has acted unreasonably by ignoring its responsibilities to conduct a reasonable investigation and to promptly pay a claim, you may consider evaluating and pursuing a separate claim for bad faith.

An insurance company may commit bad faith if it acts unreasonably in its dealings with its insured.  Some examples of suspect behavior include but are not limited to the following:

  • Insurance company did not to disclose limits of policy
  • Insurance company did not pay or deny the claim within a reasonable amount of time
  • Insurance company did not investigate the claim reasonably
  • Insurance company did not communicate pertinent information to the claimant
  • Insurance company refuses to pay the claim without conducting an investigation
  • Carrier unreasonably denies coverage
  • Insurance company did not promptly provide a reasonable explanation for denial of a claim
  • Insurance company did not deny or confirm coverage within a reasonable period of time
  • Insurance company did not respond to a time-sensitive demand
  • Insurance company offers significantly less money to settle than a realistic value of the claim
  • Insurance company did not attempt to come to a fair and reasonable settlement when liability was clear and within a reasonable time


Randall Udelman has experience representing victims of unreasonable insurance practices that can cause harm to customers/insureds by failing to honor the commitment made when the insurance company accepted its customer’s insurance premium. Contact us today to schedule your consultation.

*The information in this blog is for general information purposes only. This blog post should not be taken to constitute a formal recommendation or professional advice. We exclude all representations, warranties, legal liability or responsibility relating to its content.

Images used under creative commons license – commercial use (7/24/2016)  zenjazzygeek  (Flickr)