Life insurance is intended to provide peace of mind and financial security for your loved ones in the event of your passing. However, some policyholders may find themselves in a difficult situation if their insurance company denies or delays their claims unnecessarily. This leads to “bad faith” claims, which occur when an insurance company fails to honor its contractual obligations.
Simple mistakes do not constitute bad faith insurance. Kantor & Kantor, LLP shares the top 10 indications that you may have a life insurance bad faith claim:
1. Unreasonable Delays in Claim Processing
Q: What constitutes an unreasonable delay?
A: If the insurance company takes excessive time to process your claim without providing a valid reason, it may be a sign of bad faith. For example, it could be suspicious if you submitted a claim without any updates after several weeks or months.
2. Claim Denial Without a Clear Explanation
Q: Can an insurance company deny a claim without explanation?
A: No, insurers are required to provide specific reasons for denying a claim. If your claim has been denied without a clear and legitimate explanation, it may indicate that the insurer is acting in bad faith.
3. Failure to Investigate Claims Thoroughly
Q: How should an insurance company conduct an investigation?
A: Insurance companies must conduct a diligent and adequate investigation into claims. This may be a sign of bad faith if they seem to ignore key evidence or fail to follow up on critical information that could support your claim.
4. Excessive Requests for Documentation
Q: Is it common for insurers to request documentation?
A: While some documentation is typically required, excessive or repeated requests for the same information can be a tactic used by insurers to stall the claims process. It could indicate bad faith if you feel you are being bombarded with paperwork.
5. Lowball Settlement Offers
Q: What should I do if I receive a low settlement offer?
A: If the insurance company offers a settlement significantly lower than what you believe is fair based on your policy’s terms, it may indicate bad faith negotiations. Trust your assessment and seek legal advice right away.
6. Ignoring Policy Provisions
Q: Can an insurer arbitrarily ignore policy terms?
A: Absolutely not. Insurers must adhere to the terms outlined in the policy. If the insurer disregards specific provisions or attempts to impose conditions not outlined in the contract, it may signify bad faith.
7. Changing Positions on Coverage
Q: Is it normal for an insurer to change its stance on what is covered?
A: If an insurer frequently changes its stance on what is covered in your policy or shifts its rationale for denying a claim, this inconsistency can indicate bad faith tactics intended to confuse or dissuade you from pursuing your claim.
8. Failure to Communicate
Q: How should an insurer maintain communication with policyholders?
A: Insurers should keep you updated on the progress of your claim. If your insurer goes silent for extended periods and fails to return phone calls or emails, it may reflect bad faith practices.
9. Claims Handling Practices That Favor Denial Over Approval
Q: What does it mean if an insurer has a pattern of denying claims?
A: Some insurers may develop practices prioritizing denying claims or making the process difficult for policyholders. If you notice a trend in denied claims among other policyholders, it could imply systemic bad faith.
10. Disparaging Statements About Your Claim
Q: Should an insurer make negative comments about my claim?
A: Insurers should maintain professionalism and neutrality. If you receive disparaging or unfounded criticisms regarding your claim from the insurer, it could signify that they are not acting in good faith.
California Life Insurance Bad Faith Attorneys
The life insurance claims process can be challenging, especially if you suspect bad faith on the part of your insurer. The good news is that California law is a model for many other states’ bad faith laws.
Contact the California Life Insurance Bad Faith Attorneys at Kantor & Kantor, LLP if you recognize any of these indicators. Our experienced team works to ensure that you receive the benefits owed to you under your policy. Remember, your loved ones depend on that financial security, and advocating for your rights is essential.
