Bad Faith Insurance Claim Attorney in Birmingham, Al

If you have been wrongfully denied by an insurance company, you may have grounds to file a bad faith claim. While bad faith claims are not exclusive to insurance claims, many cases deal with situations where an insurance company fails to provide promised coverage or insurance benefits. Read on to learn why working with a bad-faith insurance attorney at Sinclair Law Firm is ideal when navigating this type of legal action.

What Is a Bad Faith Insurance Claim?

This type of claim arises when an insured person or entity believes that an insurance company acted dishonestly, unfairly, or with fraudulent intent in handling a claim. Bad faith insurance claims typically allege that the insurer did not fulfill its duty of good faith and fair dealing, which is an implied obligation in insurance coverage. 

Insurance companies are responsible for using their resources to appropriately evaluate and process your claims. However, when a claim is denied, it is often the result of the insurance company looking for ways to save money, either by cutting corners during their investigation, refusing to pay claims, or refusing to reach a fair settlement.

Some examples of bad faith insurance claims include:

Unreasonable Denial of a Valid Claim: If an insurance provider denies valid claims without proper investigation or justification.

Delaying Claim Processing: Unreasonably prolonging the processing of a claim without valid reasons.

Inadequate Investigation: An insurance company refuses to investigate a legitimate claim thoroughly or ignores evidence supporting the claim.

Offering an Unreasonably Low Settlement: Providing a settlement offer significantly below the insurance policy’s reasonable value.

Misrepresentation or Fraud: Providing false information, misrepresenting policy terms, or engaging in fraudulent activities.

The goal of bad faith claims is to reach legal action that results in the insured party being entitled to not only the benefits they were initially claiming but also maximum compensation and additional damages, such as punitive damages meant to punish the insurer for their bad faith conduct. Laws regarding bad faith insurance claims vary by jurisdiction, and it’s wise to consult with bad faith insurance lawyers familiar with local regulations if you wish to pursue a bad faith insurance claim.

Alabama Bad Faith Insurance Claims

In accordance with Alabama law, bad faith insurance claims fall into two categories: “normal bad faith,” where the insurance company knowingly rejects a claim without a reasonable basis, and “abnormal bad faith,” where the insurance company fails to investigate a claim adequately. The Alabama Supreme Court has established specific elements that must be proven in either type of bad faith claim. 

These include demonstrating that an insurance contract agreement existed between the policyholder and the insurance company, the insurer intentionally rejected the claim without a legitimate reason, there was no valid basis for denial, and the insurer was aware that the claim denial lacked support from facts and law. If the insurer refuses to investigate the claim, it is necessary to show that there was no legitimate reason to deny the claim. These legal standards and a qualified team of bad-faith insurance attorneys provide a solid framework for policyholders in Alabama seeking resolution for bad-faith actions by insurance companies.

How to Prove Bad Faith Insurance

One of the most important steps in pursuing a bad faith claim is finding a team of legal professionals to help you navigate this litigation. The truth is that it is not as simple as just experiencing an insurance company committing bad faith, exposing their actions, and receiving a settlement. 

You need a bad-faith insurance attorney to analyze your case and strategically strip away any basis the insurance company may have to deny the claims. With the right legal team, you will work together to establish specific elements in your case to demonstrate that an insurer acted dishonestly or unfairly when handling your claim.

While the requirements may vary by jurisdiction, common elements in a bad faith claim often include showing that a valid contractual relationship existed between the policyholder and the insurance company, the insurer intentionally rejected the claim without a reasonable basis, there was no legitimate reason for the denial, and the insurer knew that its denial lacked support from both facts and the applicable law. 

Additionally, in cases where an insurance company attempts to deny a claim without adequate investigation, it may be necessary to prove that there was no legitimate or arguable reason to deny the claim and that the investigation was insufficient. The responsibility of acquiring this proof lies in the party making a bad faith claim and providing evidence that satisfies these elements, which is crucial in pursuing a successful legal case against an insurer for acting in bad faith.

At Sinclair Law Firm, our team offers extensive experience navigating bad faith claims in Alabama and a commitment to helping our clients achieve the justice they deserve. Contact one of our attorneys today to get started.