Understanding and Fighting Bad Faith Auto Insurance Claims

 

Whether you’re on your way to work or out for the evening, few things in life can bust up your plans like an auto collision. Even if the worst outcome is a banged-up ride, you’re now faced with the hassle of having to stop and exchange information and then go through the headache of submitting a claim. 

After you’ve gone through all of that trouble, you expect your insurance company to follow through with their end of the deal. But in an era where these companies often try to pay as little as possible, that doesn’t always happen.

From fender benders to distracted drivers, dealing with a car accident is stressful enough. The last thing you need is your insurance company adding to the burden. When insurance companies engage in these bad faith practices, making it difficult for policyholders to receive the benefits they've paid for, the consumers who trusted them are left holding the bag. 

The good news is that attorneys like Tim Gilpin are there to help you understand your rights and how to fight back against these unfair tactics.

What is Bad Faith Auto Insurance?

Anytime you pay for auto insurance, you are entering into a contract with the insurance company. In exchange for the premiums you pay in, the insurance company agrees to cover specific losses according to the terms outlined in your auto insurance policy. 

Liability coverage, which is legally required on most vehicles in nearly every state, includes payments for the other party’s bodily image including accident-related pain and suffering and coverage for any property damage you cause during an accident. 

Collision coverage covers any damage to repair or replace your vehicle no matter who happens to be at fault in an accident or how it occurs, even if that means you collided with a guardrail or backed into a light post. 

Comprehensive coverage insures your vehicle against damage from just about anything whether it’s crushed by a tree branch, slammed into by a deer, or vandalized by overzealous graffiti artists. 

And then there are the additional types of coverage like medical payments coverage or uninsured motorist coverage. What’s included with your coverage can vary from one insurance policy to the next, which is why it’s always a good idea to read through your terms carefully. For example, some policies will cover the cost of basic roadside assistance or even a tow. 

The one thing all of these policies have in common is that it’s the insurance company’s job to pay out when you need them to. 

Whatever your insurance policy coverage includes, bad faith occurs when an insurance company acts unfairly or deceptively in handling your claim, breaching this contractual agreement. Essentially, bad faith means they're not holding up their end of the bargain.

Common Bad Faith Tactics Used by Auto Insurance Companies

You’ve probably heard stories about health insurance companies automatically denying claims or delaying them to reduce the amount they have to pay out. 

Just like health insurance companies, auto insurance providers are businesses with profit motives. This can sometimes lead them to prioritize their bottom line over their policyholders' needs.

Here’s are four of the most common tactics some auto insurance companies will use to reduce their payouts:

Unreasonable Delays

It’s reasonable that an insurance company would need time to gather evidence and fully investigate your claim. But if the fault is clear or the insurance company has had more than enough time to gather evidence, this could constitute an unreasonable delay as the company drags out the claims process hoping you’ll be willing to settle for less or give up entirely.  

Lowball Offers and Biased Appraisals

Lowball offers can happen when an insurance company sends out an appraiser who estimates your damages much lower than what they should be. This is where it pays to get a second opinion and request a complete breakdown of how the insurance company’s offer was calculated. 

Incomplete Investigation

Failure to completely review the evidence or thoroughly investigate before reaching conclusions is another common tactic. 

Denying Valid Claims

Some insurance companies will cite non-applicable policy exclusions or misrepresent the facts of the car wreck in order to wrongfully deny your claim. 

Fighting Back Against Bad Faith Insurance

While there’s no surefire way to prevent insurance companies from attempting shady tactics, there are some things you can do to make it easier to fight back when they do. 

Review Your Policy

Take the time to read through your insurance policy and understand any exclusions, coverage limits, and anything else related to the claims process. 

Document Everything 

Keep every piece of evidence and interaction related to your claim in a folder on the cloud, and snap photos of any documentation as a back-up. This includes photos of your vehicle before and after and detailed records of all communication with the insurance company, including dates, times, names of representatives, and summaries of conversations. 

Communicate in Writing

If possible, use email for your communication with the insurance company. When you must communicate by phone, consider downloading a voice recording app or an application that transcribes communications. This way, it’s not just your word against theirs when there’s a dispute over an interaction. 

Request an Explanation

Ask the insurance company for a detailed written outline of their reason for denying your claim so you’ve got something to dispute. Ask them to cite any pertinent policy provisions related to the denial. 

Appeal Your Claim Denial

As soon as your claim is denied, request information about starting the appeals process. Keep a record of every effort you make to follow through with the appeal, pay careful attention to any timelines outlined in their policies and procedures, and make sure you’ve got all of your documentation.
 

Contact Tim Gilpin for a Bad Faith Claim Consultation

If you’ve gone through all of the steps and you suspect you’re dealing with a bad faith auto insurance denial, it’s time to connect with an attorney who has experience in bad faith insurance litigation. 

Tulsa-based personal injury attorney Tim Gilpin is committed to helping Oklahomans navigate the complexities of auto insurance and bad-faith claims — and he has won his clients millions in court, mediation, and settlements.

If you’re facing a bad faith insurance claim, it’s time to schedule your bad-faith legal evaluation. Tim charges no fee if there’s no recovery, so give Tim Gilpin a call today!