Insurance premiums can be a significant expense, but you make these payments with the expectation that your insurance provider will treat you fairly if you ever need to make a claim. Unfortunately, insurance companies have developed a reputation for using unsavory tactics to avoid paying settlements.
If your insurer fails to fulfill their duties to you, you may be able to pursue a bad faith insurance claim. Learning to recognize bad faith actions can help your case.
Common examples of bad faith practices
Texas requires that insurance companies avoid certain unfair practices, some of which include:
- Failing to properly investigate the claim
- Misrepresenting important facts related to the policy
- Refusing to pay out a reasonable settlement when liability is clear
- Failing to explain why they denied a claim
- Offering an unreasonable explanation for a denial
Additionally, insurance providers must act in a timely manner and avoid delays in investigating claims, paying settlements and offering explanations for claim denials.
Tips to protect yourself against bad faith insurance practices
Though you can file a claim against an insurer for unfair or dishonest acts, you can take steps to protect yourself from these practices in the first place. Consider the following tips:
- Research an insurer before taking out a policy
- Review your policy carefully
- Carefully document all factors related to an incident you need to file a claim for
- Keep all communications between you and the insurance company and require important details in writing
Even if you have had positive interactions with your insurance company in the past, you should assume the insurer will always act in their own best interest. Due diligence on your part could help you get the settlement you need.
