Insurance companies should provide their clients with financial security, but sometimes, they can create more problems than they solve. The process can be difficult for West Virginians who need to file insurance claims after car accidents or home damage.
When you file an insurance claim in West Virginia, the insurance company is obligated to act in good faith and treat you fairly. This duty applies to all insurance claims, including auto accidents, property damage, and life or disability policies.
If an insurance company fails to fulfill its duty of good faith, it may be guilty of bad faith. You have the right to take legal action against an insurance company that has acted in this manner.
At DiPiero Simmons McGinley & Bastress, PLLC, we can help you take the next steps with your claim. Reach out to a Charleston, WV bad faith insurance lawyer to learn more.
What Is a Bad Faith Claim in West Virginia?
In West Virginia, a bad faith claim is a situation in which an insurance company fails to settle or pay a claim in good faith. This can occur in two ways: common law or statutory claims. In this state, both types are used interchangeably.
The West Virginia Unfair Trade Practices Act governs statutory bad faith claims. According to this act, unfair claim settlement practices include:
- Refusing to pay claims without conducting a reasonable investigation based on all available information
- Failing to settle claims where liability is reasonably clear
- Attempting to settle a claim for less than what a reasonable person would believe they are entitled to
- Not attempting in good faith to deliver prompt, fair, and equitable settlements
- Engaging in other practices that violate the statute
Under this statute, the insured must show that the insurer’s conduct is more than a single violation. These actions must be from a “habit, custom, usage, or business policy” of the insurer. The evidence must also show that these practices are a “general business practice” instead of an isolated event.
Keep in mind that statutory bad faith claims can only be pursued after the initial claim is settled or resolved via trial.
If you believe that you have a valid case against your insurance company, consult with a qualified Charleston bad faith insurance claim lawyer to determine your best course of action.
What Is a Common Law Bad Faith Claim?
When insured individuals file a claim, they expect their insurer to act in good faith to settle it.
However, there are instances where insurance companies engage in bad faith practices. As a result, that can cause undue harm and hardship to policyholders. There are several ways that an insurance company may not act in good faith.
Investigation
Insurance companies have a legal and ethical obligation to investigate all claims they receive thoroughly.
Failure to adequately investigate or deny a claim without proper investigation can constitute bad faith behavior. Another example is excessively delaying the claims process without a valid reason.
Settlement
As profit-driven entities, insurance companies may prioritize their financial interests over fair settlements. This may result in inadequate compensation or undervaluing your losses, which is a tactic to protect their profits.
All policyholders deserve a fair settlement that adequately compensates them for their losses.
Denials
Prolonging the claims process without valid reasons can cause undue hardship and may be considered a bad faith practice. Additionally, denying a claim after an unreasonable delay is equally problematic since it can cause policyholders significant harm and financial losses.
Whether it’s an auto accident claim, homeowner’s insurance, or disability coverage, policyholders deserve an insurer that upholds its promises and acts in good faith.
If you believe that your insurance company acted inappropriately, make sure to reach out to a Charleston, WV bad faith insurance lawyer in our office to learn more about your legal options.
Can Third-Parties Sue for Bad Faith?
In West Virginia, at one time, third parties could sue insurance companies for bad faith. However, the state legislature passed WV Code § 33-11-4a, eliminating this legal avenue for third-party claimants.
As a result, only directly insured individuals now have the right to bring bad faith claims against West Virginia insurance companies.
While this may be a setback for third-party claimants, there is an alternative remedy available.
They can file an administrative complaint with the West Virginia Insurance Commissioner within one year of the alleged bad faith practice. Upon receipt of the complaint, the commissioner will investigate the matter and take appropriate actions if necessary.
What Can You Recover?
When filing a bad faith claim against your insurance company, there are several types of damages that you may be eligible to recover.
Compensatory damages provide for the actual losses you suffered due to the insurer’s bad faith conduct. These can include:
- Unpaid benefits if your claim was wrongfully denied or delayed
- Out-of-pocket expenses, such as medical bills or repair costs
- Compensation for emotional distress caused by the insurer’s bad faith behavior
Punitive damages punish the insurer for their wrongful conduct and deter similar behavior in the future.
They are awarded when the insurer’s actions were particularly egregious or intentional. The amount of punitive damages varies based on the severity of the bad faith. Additionally, these damages are not awarded in every claim.
If you have a successful claim, you may also be able to recover reasonable attorney’s fees and litigation costs. Also, you may be entitled to interest on the unpaid benefits or damages from the date they should have been paid.
Let Us Help with Your Charleston Bad Faith Insurance Claim
Unfortunately, sometimes insurance companies act in a deceptive or unethical manner, putting your life on hold. You can hold them accountable for their actions with the help of a skilled Charleston bad faith insurance lawyer.
At DiPiero Simmons McGinley & Bastress, PLLC, we understand the impact a bad faith insurance decision can have on your life. That’s why we are committed to fighting for you to get the coverage you deserve to receive in the first place. We will then work with you to review your options and develop a strategy for getting justice.
If you are struggling with an insurer’s handling of your claim, you have legal options. Schedule a consultation with a Charleston, WV bad faith insurance lawyer by contacting our office today.
