Insurance Bad Faith

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 Insurance companies are required by law to treat their customers fairly. Fair treatment includes payment of claims that are rightfully due to an insured who has paid all policy premiums and properly submitted the claim. In 1982, the State of Florida enacted the Florida Unfair Claims Practices Act (UFCA) to protect consumers from insurance companies that do not make good faith efforts to settle claims. Bad faith insurance regulation arose because, in the past, insurance companies have mistreated their clients and refused to pay for legitimate claims.

There are two types of bad faith insurance claims, first-party and third-party claims. A first-party bad faith claim is brought by the insured party in response to the insurance company failing to in good faith when a policyholder makes a claim against their own policy. A third-party relates to the insurance company’s handling of a claim made against the policyholder.

Insurance companies do not always have your best interest in mind. Never forget that an insurance provider is a private company. That means it has its own bottom line to protect, often at the expense of its insurance policyholders. If your insurance company terminated your coverage or provided only a partial payment amount, then you may have fallen victim to insurance in bad faith. If an insurance company has denied your claim without a good reason for doing so, you may also have fallen victim to insurance bad faith.