When you purchase an insurance policy, you enter into a contract with your insurance company. This contract obligates the company to act in "good faith and fair dealing" when handling your claims. Unfortunately, not all insurance companies live up to this obligation. In Florida, when an insurance company fails to act fairly towards its policyholders, it may be held liable under what is known as a "bad faith" insurance claim.
What Constitutes Bad Faith? Bad faith insurance practices can manifest in various ways, but common examples include:
- Unjustified denial of coverage: When an insurer denies a claim without a reasonable basis.
- Failure to communicate pertinent information: Insurers must keep policyholders informed about claim status, requirements, and reasons for denial.
- Failure to conduct a proper investigation: Insurers are required to investigate claims thoroughly before denying them.
- Unreasonable delays in claim processing: Delaying the investigation or payment of claims without a valid reason.
- Refusal to pay a valid claim: Not paying or settling claims when the obligation to do so is clear.
Legal Framework in Florida: Florida law provides some protections for consumers against bad faith insurance practices. Florida Statute § 624.155 allows policyholders to bring a civil remedy notice of insurer violation, giving insurers a 60-day window to resolve the issue before formal litigation can commence. This statute is designed to encourage insurers to treat claims with the seriousness they deserve.
Filing a Bad Faith Claim: To establish a bad faith claim in Florida, the policyholder must prove that the insurer did not just make a mistake or an error in judgment, but that it acted in bad faith. The process typically involves:
- Sending a Civil Remedy Notice: This notice must detail the statutory basis for the claim, the facts and circumstances giving rise to the violation, and the specific policy language relevant to the dispute.
- Waiting Period: After the notice is sent, the insurer has 60 days to address the violation.
- Filing the Lawsuit: If the insurer does not resolve the issue within the prescribed period, litigation can commence, after prevailing on the underlying claim.
Potential Outcomes: If a court finds that an insurer has acted in bad faith, the consequences can be significant. The insurer may be liable for:
- Compensatory Damages: Covering what the policyholder should have originally received under the policy plus additional financial losses caused by the bad faith conduct.
- Punitive Damages: In cases of particularly egregious behavior, punitive damages aimed at punishing the insurer may also be awarded.
Bad faith insurance claims are a vital mechanism for protecting consumers and ensuring fair treatment under the law. Policyholders in Florida facing resistance from their insurers have legal avenues available to challenge unjust practices and obtain the benefits they are duly owed. If you believe your insurer is acting in bad faith, consulting with an experienced attorney in insurance law can provide you with the guidance and representation needed to navigate this complex area.
This overview of bad faith insurance claims in Florida highlights the importance of insurers' obligations to act fairly and the legal protections available to those affected by unethical practices. For those experiencing issues with their insurance claims, understanding these principles is the first step towards securing justice and proper compensation.
Have you or someone you know been the victim of insurance bad faith? Contact Florida Insurance Bad Faith Lawyer J.P. Gonzalez-Sirgo by dialing his direct number at (786) 272-5841, calling the main office at (305) 461-1095, or Toll Free at 1 (866) 71-CLAIM or email Miami Attorney Gonzalez-Sirgo directly at [email protected] or by text at (305) 929-8935.
