You purchased your homeowners insurance policy with the understanding that your insurance company would act in good faith in the event that something happened. Now, the time has come for you to put your policy to use and you find that the insurance company has delayed, underpaid or flat-out denied your claim. Your insurer seems to have no interest in fulfilling its obligations to you. What do you do now?
Insurance Companies Must Act In Good Faith
By law, insurance companies are required to act in good faith to fulfill their obligations to you. When an insurance company purposefully finds a way to avoid investigating or paying your claim, it may be acting in bad faith. Victims of insurance bad faith have the right to take action against the insurer. However, identifying bad faith is not always easy.
Signs Of Insurance Company Bad Faith
Insurance companies tend to make it look like they are following the terms of the homeowners insurance policy. When denying your claim, your insurer may tell you that the event is simply not covered for some reason. It may tell you that the underpayment is because the damages exceed your policy limits. It will make it sound as if it is doing exactly what it agreed to do in your policy.
In reality, the insurance company may be acting in bad faith if it fails to respond to your claim in a timely manner, refuses to investigate your claim, underpays your claim, denies your claim completely or refuses to explain why it is delaying, underpaying or denying your claim. In other words, if anything seems like it does not make sense based on your understanding of your homeowners insurance policy, you should dig deeper and determine whether you are the victim of insurance company bad faith.
If your home has been damaged or you have any other type of home insurance claim, you have the right to expect that your insurer will fulfill the promises it made to you when you signed up for your policy.