Although insurance companies are expected to uphold their policies by treating claimants honestly and fairly, some may unreasonably deny a claim or reduce its worth.
When an insurer behaves unethically while adjusting a claim or reaching a settlement offer, it can be held liable. If you believe an insurer has acted in bad faith while handling your claim, contact Simien & Simien, LLC‘s Louisiana insurance lawyers. We have the resources to fight against large insurance companies and the determination to hold them accountable. Our accomplished law firm has represented clients throughout Louisiana for more than 20 years in claims involving insurance disputes. Contact us for a free consultation to determine if we can help recover the benefits promised in your insurance policy. We work on a contingency fee basis, so you do not pay us unless we reach a fair outcome for your claim.
Fill out a Free Case Evaluation form to consult with our Louisiana insurance lawyers.
Bad-Faith Insurance Claims
Unfortunately, insurance companies are in the business of making money and often do everything they can to limit what they pay out for insurance claims, even if the claim is valid.
To ensure that insurance companies do not take advantage of claimants, Louisiana has two bad-faith insurance laws that detail how companies must handle claims and the penalties they could face if they fail to handle a claim in a fair manner.
Good Faith And Fair Dealing
In Louisiana, all insurance companies are legally required to act in good faith and fair dealing when investigating, adjusting and settling claims, according to Louisiana Revised Statute § 22: 1973.
Under this law, insurers have an obligation to adjust claims in a timely and efficient manner and to make a reasonable effort to settle all claims.
Because of this, if an insurer knowingly commits any of the following acts, it may have acted in bad faith and could be held liable:
- Misrepresenting relevant facts or insurance policy provisions relating to any coverages at issue
- Failing to pay a settlement within the 30-day deadline after an agreement was reached and placed in writing
- Denying coverage or attempting to settle a claim on a basis the insurer knows was altered without notice, consent or knowledge of the insured
- Misleading a claimant as to when legal proceedings may be initiated
- Neglecting to properly compensate a claim owed to any person insured by the contract within 60 days after receiving satisfactory proof of loss from the claimant when such negligence is unreasonable, random or without probable cause
- Failing to pay claims in accordance with La. Rev. Stat. § 22: 1893 concerning immovable property when such failure is irrational, arbitrary or unreasonable
However, it is important to understand that not every denied or reduced claim is considered to be in bad faith. If an insurance company has a reasonable basis for making a mistake or error, it cannot be considered a claim made in bad faith. The insurance company must know that it unfairly adjusted, settled or denied a claim.
Payment And Adjustment Of Claims
Furthermore, insurance companies have an obligation to adjust and pay claims fairly and promptly after the insured has filed a claim. La. Rev. Stat. § 22:1892 details the timelines and requirements insurers must follow for fair and prompt adjustment and payment.
The process begins when an insured provides a satisfactory proof of loss that adequately states the loss he or she has incurred and provides an estimate of the damages recoverable under his or her original policy.
Upon receipt of the proof of loss for claims involving property damage or reasonable medical expenses, an insurer is required by law to begin adjusting a claim within 14 days.
The only exception to this deadline is in the event of a catastrophic loss, such as those experienced during a large-scale natural disaster, in which case the insurer’s deadline is extended to 30 days.
The insurer is then required to make a written offer to settle any property damage claim, including a third-party claim, within 30 days of receiving a satisfactory proof of loss of that claim.
However, the deadline may be extended up to an additional 30 days in the event of a federally or gubernatorially declared disaster or emergency.
If an insurer neglects to uphold the terms of the insured’s policy or comply with the third-party claimant after receiving a satisfactory proof of loss, it can be held liable for acting in bad faith.
Our Louisiana insurance lawyers are familiar with the tactics insurance companies use to deny or reduce claims and can identify when an unreasonable decision was made in bad faith. We can review your claim to determine if it fits the structure for an unethical or illegal adjustment and settlement offer and may be able to hold the insurer liable.
Penalties For Bad-Faith Insurance Claims
Under both of Louisiana’s bad-faith insurance laws, an insurer can be considered to be acting in bad faith if its actions are “arbitrary, capricious or without probable cause.” This means if an insurer’s denial, delay or settlement of a claim is unjustified or lacks probable cause or a reasonable basis, the company could be penalized for acting in bad faith.
The methods for penalizing and recovering damages from an insurer found guilty of acting in bad faith differ between each law.
Damages Under La. Rev. Stat. § 22:1892
If you can prove the insurer failed to treat your claim fairly and provide you with an accurate adjustment or settlement offer, you may be entitled to the damages originally owed in your claim.
In addition to the loss of the value of your claim, the insurer may also be subject to a penalty of 50 percent of the amount owed to the insured or $1,000, whichever amount is greater.
In the event that a partial payment has already been made, the insurer must pay 50 percent of the difference between the amount paid or offered and the amount due, as well as reasonable attorneys’ fees and costs.
Damages Under La. Rev. Stat. § 22: 1973
In addition to any damages to which a claimant is entitled for the insurer’s breach of duty, he or she may be awarded further compensation.
These damages can reach an amount no greater than two times the damages the claimant sustained or $5,000, whichever amount is greater.
By consulting with a Louisiana insurance lawyer knowledgeable in bad-faith claims, you could potentially maximize the damages you can recover. Contact our Louisiana insurance attorneys to determine if you are owed compensation for a claim against an insurer who acted in bad faith.
Fill out a Free Case Evaluation form to get started with our Louisiana insurance lawyers today.
Types Of Insurance Claims We Handle
Our Louisiana insurance lawyers have decades of experience handling cases involving insurance disputes of all types, including, but not limited to:
Life Insurance Claims
Life insurance can help provide loved ones of a deceased claimant with financial support for living expenses, funeral costs, and loans and other debts the deceased left behind.
Before the beneficiary can receive payments or a lump sum for a life insurance policy, he or she needs to file a claim. Insurance companies may falsely state the cause of death is not covered by the policy or that the claimant was responsible for causing his or her own death.
If you are denied a valid life insurance claim or an insurer delays your payment in bad faith, you may have legal options to pursue the damages you rightfully deserve.
Our Louisiana insurance attorneys understand the obligations placed upon insurance companies and will review your claim or settlement offer to determine if it was reached in bad faith.
Homeowners insurance is an important policy that offers protection against damages to your house or the possessions inside your home. Many homeowners in Louisiana depend on their insurer to live up to the terms in their policy, especially against intense flood, wildfire and storm damage that frequently occur throughout the state.
Unfortunately, insurance companies may use unethical methods to deny or reduce the benefits of a policyholder. An insurer may accuse the claimant of filing for preexisting damage to his or her home or may claim the specific damage is not covered by the policy.
Our Louisiana insurance lawyers can help you defend your claim if an insurance company unjustly denies or reduces your homeowners insurance claim.
There are many instances in which a business will require a commercial insurance policy to protect it from extreme loss, unfair deals or fraud. In some cases, a business cannot survive without insurance coverage for property damage, legal liability and employee-related risks.
If an insurer neglected to handle a business insurance claim in good faith, it could lead to detrimental results.
If you are a business owner and you believe your claim was handled unreasonably by an insurance company, contact our Louisiana insurance lawyers. We may be able to help you file an appeal or explore legal options concerning unethical or illegal insurance practices.
Long-Term Disability Benefits
People with disabilities depend upon long-term disability (LTD) insurance to provide them with fair benefits to cover medical expenses, rehabilitation costs and lost wages.
LTD insurance can be costly to an insurer, and one may act in bad faith by denying payments to an individual with a disability. Insurers may also delay payments by requiring the claimant to provide unnecessary or duplicate information.
If an insurer lowers a disabled claimant’s benefits or denies a valid claim for invalid reasons, it may be held liable for acting in bad faith.
Our Louisiana insurance lawyers are well-versed in the state’s insurance laws and may be able to help you recover the benefits you are rightfully entitled for your disability.
Damage From Natural Hazards And Disaster
When a natural disaster causes large-scale damage to a location or region, many people will file claims at the same time. This may cause insurance companies to become defensive and deny or reduce a significant number of claims in order to preserve their own interests.
Louisiana residents are especially vulnerable to this unethical practice, particularly when a hurricane, flood, wildfire or tornado strikes the area. Insurance companies are obligated by state law to act in good faith in the event of a natural disaster, and those who neglect to follow the law are subjected to harsh penalties.
If your life has been affected by a natural disaster, and an insurance company has unreasonably reduced your claim’s damages or acted in bad faith to deny it altogether, contact our Louisiana insurance lawyers for experienced legal help and advice.
Workers’ Compensation Claims
An employee who acquires a workplace injury is entitled to benefits from his or her employer after the claim is approved by the employer’s insurance agency. Many insurers will find reasons to deny the claim by saying the accident did not occur at work or the injury was a preexisting condition.
Workers’ compensation claims are often disputable and can be appealed with the help of an experienced Louisiana workers’ compensation lawyer.
Auto Insurance Claims
Car owners in Louisiana are legally required to purchase insurance on their vehicles. Although liability in most auto accidents may seem straightforward, many claims are often unjustly denied or reduced to an unreasonable amount.
If an insurer incorrectly attempts to place you at fault for the accident and denies your claim, you may have legal options that you can further explore with an accomplished car accident attorney in Louisiana.
If you believe your insurer acted in bad faith when handling your claim, contact our Louisiana insurance lawyers. We can help protect your rights as a consumer and may be able to recover the compensation you deserve.
Contact Our Louisiana Insurance Lawyers
If your insurer has rejected your claim or has provided you with an inadequate settlement offer that does not accurately reflect your loss, contact a Louisiana insurance attorney immediately.
Our accomplished Louisiana insurance attorneys have experience practicing litigation in both state and federal courts, including the Louisiana Supreme Court.
Our firm began in 1989 and we have several decades of combined legal experience in fighting injustices by the insurance industry. We will work as a team and use this experience to fight for the fairest outcome in your disputed insurance claims.
Our Louisiana insurance lawyers will review your claim through a free, no-obligation consultation to determine whether you have the option to pursue legal action. Our clients are never charged upfront legal fees, and we only work on a contingency fee basis.
This means we perform all our services, including working and negotiating with insurance companies, at no cost. You do not ever pay us unless we reach a settlement for you. Do not hesitate to seek experienced legal help.