When to Consider Filing a Bad Faith Insurance Lawsuit (continued)
Are There Exceptions?
Again, it pays to know your policy. Some types of insurance, especially health and wellness plans, make you agree to accept arbitration instead of a court hearing to settle disputes. Awards are usually binding, and will likely not include punitive or additional damages.
If you are insured by a group employee-benefits policy, federal Employee Retirement Income Security Act (ERISA) laws may supersede the bad faith laws in place in your state, making a lawsuit not a viable option. Your insurance lawyer will know whether either of these situations applies based on your policy documents.
Should I File a Lawsuit?
The ability to prove the insurance company’s intentional ill gain
rests on various aspects of the “bad faith” definition. Individual state case law decides what bad faith is, and this changes over time.
The legislative atmosphere may or may not be receptive to your case, even though you may be in the right.
Of course, each case is unique. That is why paying special attention to how the insuring company handled the claim investigation can pay off in court. The legal perception of what constitutes an adequate and timely investigation changes based on past arguments. Your case could be the one to set a more definitive precedent in your state.
Work with your insurance attorney to compile the details surrounding your claim, the time line and the steps you took to petition the insurance company or comply with its requests. When the bad faith insurance action is shown alongside your good faith behavior, it may be compelling enough to succeed before a jury.
The final considerations are your attitude and ability to stand trial. If yours is a medical insurance claim, physical issues may be more pressing. The strength of the evidence in your case must be matched by your own persistence in seeing the proceedings through. If you decide to file a lawsuit in the heat of the moment and later reconsider, the effects may add to your woes.
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