Accidents can happen when we least expect them. You never know when you might get into one, and to protect yourself from the unpredictable, you pay a monthly premium to your insurance company. In return, your insurer must compensate you for any damages when an accident happens. However, sometimes insurers deny valid claims and refuse to pay the policyholder. If this happened to you, you might be a victim of bad faith insurance, and there is a way in which you can fight back.
How insurance companies work
Your insurer must help you when you file a legitimate claim with them. A claim is legitimate as long as it complies with the terms of your policy. Once you file a valid claim, the insurer must follow certain procedures. Whenever an insurer fails to comply with their duties, they are guilty of bad faith insurance practices.
Bad faith insurance claims
Insurance companies exist to protect their clients, which is why it is reasonable to take legal action against them when they fail to do what they are supposed to. The law in Alaska prohibits bad faith practices and allows you to file a legal claim against an insurer whenever they disrespect the contract you have with them. According to the law, insurers cannot:
- Misrepresent facts or policy provisions relating to coverage of an insurance policy
- Fail to act promptly after a claim
- Fail to adopt standards to investigate the claims
- Refuse to pay a claim without reasonable investigation of all the available information about the case
- Fail to explain the denial of the claim
- Fail to give coverage for claims within a reasonable time of the completion of proof-of-loss statements
- Fail to make prompt and equitable settlement of claims in which liability is clear
- Offer less than the amounts they agree to pay on their policy
- Make the payment of a claim without including a statement of the coverage under which they make the payment
- Convince the insured to accept a settlement that is less than the amount they would get in arbitration
- Delay investigation or payment of claims by asking the insured to file repetitive claim reports or proof-of-loss forms
If your insurer did or failed to do any of those things, you have the right to take legal action in court.
You can hold the insurer liable by taking your case to court. If you win the lawsuit, you could recover the compensation outlined in your policy. Besides, you could receive an award for punitive damages. You don’t deserve to be a victim of bad faith insurance practices, and you have the right to fight back against this injustice.