The insurance industry dates back to the beginnings of human society; at least in some form. Neighbors in ancient civilizations often had agreements that if one of their houses was destroyed, all others would work to build a new one. Insurance has undoubtedly changed since then, and one of the negative aspects that have come from this evolution is bad faith practices. Bad faith occurs when an insurance company purposefully tries to deny or delay a legitimate claim in an effort to save money. For anyone filing an insurance claim of any type, it's imperative to recognize the signs of bad faith practices so that action may be taken.
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1. Directing towards another Party
Whenever a person suffers an injury, it's usually quite obvious which insurance company is supposed to provide compensation. If a person rear-ends a vehicle, it's their insurance that should pay out. If a worker is injured on the job, it's the worker's compensation insurer's responsibility. Some of these companies, however, will attempt to skirt their duty by telling the injured individual that they should seek compensation from another party. It doesn't take a rocket scientist to figure out which insurer is responsible for paying, so if they're sending a person in another direction, bad faith practices could be occurring.
2. Delay in Decision
Another tactic insurance adjusters will sometimes use is delaying a decision on a claim. This increases the chance that a person will take a lower settlement, and in some cases, allowing too much time to pass may actually prevent a person from receiving compensation.
One example of this type of behavior occurred when Liberty Mutual Fire Insurance Company delayed and eventually denied a security guard's worker's compensation claim after the employee was injured on the job. This delay in a fair payment of benefits resulted, as it does in many cases, in additional physical damages and even emotional harm. If it seems as if an adjuster is stalling, this is a strong sign of bad faith.
3. Offering Legal Advice
Insurance adjusters are not attorneys, so they shouldn't be doling out legal advice. The legal advice that should make a person suspicious of bad faith practices, however, is an adjuster telling a claimant that they do not need an attorney. In reality, there may be times when an attorney isn't needed. An accident that only results in property damage, for instance, won't likely require a legal professional. Even with this being the case, the fact remains that an adjuster has no reason to recommend against hiring an attorney unless something fishy really is occurring.
4. Demanding Excessive Documentation
Demanding excessive documentation is another form of delaying that is especially prevalent. Referring back to Liberty Mutual, adjusters know that consistently asking for more and more documentation will postpone their having to pay benefits. Unfortunately, tough economic times have made this and other bad faith practices prevalent in the company. A person should always check their policy to see if the requested documentation is actually required by the policy.
The insurance industry is paid to make sure that people are taken care of when they need it. That is basically its sole purpose, so when money-hungry companies have their adjusters try to sidestep this obligation, it's important to hold them accountable. Bad faith practices are illegal, and insurers who engage in them can face lawsuits from the person they're trying to defraud. The compensation a person receives at this point is often excessively larger than what they would've otherwise received, so if an individual suspects bad faith practices, they should immediately speak with an attorney.
Lisa Coleman shares some ways that may indicate bad faith is being practiced by an insurance company, and discusses the important role legal representation can have. She recently read at http://www.doyleraizner.com/workers-compensation-bad-faith-disputes-with-liberty-mutual about bad faith claim dispute lawsuits being filed against Liberty Mutual for such practices.