When someone acquires an insurance policy, they sign a contract and make subsequent payments in good faith while rightly assuming they will be taken care of if an event occurs that is covered by the policy. However, insurance companies are still businesses at the end of the day—they care about making more money than they spend. Far too often, an insurance company will unreasonably refuse to honor the obligations explicitly outlined in the policy as a way to avoid paying money that is rightfully yours. Other times, they may simply attempt to severely minimize the amount paid to you. This is often considered insurance bad faith in Oklahoma (and practically every other state).
What is Insurance Bad Faith?
Some examples of insurance bad faith include:
- Undervaluing your claim
- Unreasonable denial of your benefits
- Failure to even investigate your claim
- Refusal to pay the full amount of claim owed
- Unreasonable (e.g., intentional) delays in investigating your claim
- Unreasonable delay in processing your claim
- Misrepresentation of your benefits and coverage
- Failure to explain why your claim was denied
- Unreasonable interpretations of policy language
- Imposing unreasonable, arbitrary deadlines or time limits to make your claim
- Forcing a claimant into litigation in order to delay offering a fair settlement amount
- Agent negligence
- Issuing a fraudulent policy
- Not putting the paperwork through on the policy you purchased
- Failure to disclose policy limits
- Failure to defend the insured against third-party claims
- Redefining what constitutes necessary medical procedures, home repairs or auto repairs in order to deny a partial or total claim
What events can lead to insurance bad faith in Oklahoma?
Many of the examples listed above are somewhat rare, such as issuing a fraudulent policy. In most cases, insurance bad faith in Oklahoma often involves a company refusing to pay fair value on your claim.
Some events that can lead to this include:
- Storm damage
- Weather damage (hail and wind)
- Fire damage
- Water damage (flooding, burst pipes)
- Defective products, including auto parts or appliances
- Negligent drivers
- Unexpected deaths, or deaths deemed “suspicious”
- Prescriptions of a-typical medical treatments or medications
All of these scenarios can lead to an insurer denying your claim, as they may state that these events are not actually covered by the policy you’ve chosen.
Consider this example scenario: A typical Oklahoma spring storm rolls through, showering your home with hail. The hail breaks the window in your attic, and then a downpour starts. Your homeowner’s policy covers hail damage, so naturally, you make a claim. The insurance company responds and says they’ll pay for the window repair, but not for the damage inside the attic and home caused by the rain getting inside. The insurer’s logic? The water damage was from rain, not hail.
When to hire an attorney to fight bad faith from an insurer
If you believe that an insurer is acting in bad faith about your claim, litigation is typically your best option to fight the insurer. You’ll often find that insurers will suddenly offer a fair settlement the moment they become aware that you’ve hired an attorney.
However, your attorney can represent you in a trial if they refuse to offer a fair settlement.
The Worth of a Bad Faith Insurance Claim in Oklahoma
Oklahoma has parameters in place to discourage bad faith from insurance companies. In fact, your bad faith claim could very well end up being worth more than your initial insurance claim, as you may be entitled to additional compensation for:
- The original amount of your claim;
- Any loss of income or other financial losses that you accrued (such as lost wages, or lost revenue through business interruption claims);
- Punitive damages.
Punitive damages can be limited in one of the following ways:
- Either the value of your claim; or
- $500,000.00; or
- Unlimited damages if the Court deems the insurance company’s conduct to be sufficiently cruel.
Don’t Be a Victim of Your Insurer
Insurance companies owe you a legal duty to treat you fairly and in good faith. If you find yourself in a dispute with your insurance company for any reason, Overman Legal Group is ready to step in. Our skilled negotiators have years of experience dealing with insurance companies and will work on your behalf to reach a fair resolution—or aggressively sue if a settlement is not reached. We can also assist clients with insurance coverage litigation if coverage or benefits are disputed.
Don’t let your insurance company withhold what is rightfully yours. We can help.
