When you make a valid claim but your insurance company does not pay the benefits promised in your policy, there are ways to encourage the insurance company to settle.
Insurance companies exist primarily to make a profit. They want to take in premiums, but generally pay out as little in claims as possible. Therefore, they will often use tactics to deny claims and pay less than the policy requires. This unreasonable denial or failure to meet obligations under an insurance policy may be considered “bad faith,” and a lawyer can file a lawsuit to force the insurer to settle and get you the benefits you deserve. In addition, in a successful bad faith insurance case, you can win compensation for damages that is over and above the amount of the denied claim.
Pennsylvania laws are complicated, and insurance companies also have good lawyers on their payroll working on their behalf, so fighting them is not something you should attempt to do on your own. Your case must be handled correctly and competently, or you may never collect the compensation you are entitled to. Pennsylvania has a specific statute permitting “bad faith” claims for what is called first party benefits; that is your own insurance company. There also are instances where a so-called “excess verdict” could lead to bad faith damages. There are many permutations of the law.
Our personal injury attorneys at Rieders, Travis, Dohrmann, Mowrey, Humphrey & Waters have spent decades honing their skills and successfully representing Pennsylvania families who have been injured and suffered loss due to unfair treatment by insurance companies. We know the law and how to navigate the claims system to help you get the settlement or verdict you deserve.
Our attorneys offer personal attention and loyalty to every client, aggressively fighting for justice and their right to compensation. We offer a free telephone consultation to examine the facts of your case and determine the best way to force your insurance company to make a fair settlement. We generally work on a contingency basis, so there are no fees to you unless and until we win your case.
Call us today at (570) 323-8711 to set up your free and confidential consultation.
What Happens if My Insurance Company Does not Settle?
Pennsylvania holds insurance companies to a duty of good faith and fair dealings with their policyholders in making payment of valid claims.
Insurance companies control the claims settlement processes and have financial resources and far greater negotiating strength and expertise in settling claims than policyholders do. Recognizing this disparity, Pennsylvania holds insurance companies to a duty of good faith to adhere to the policy’s terms and to pay valid claims covered under the policy. According to Pennsylvania law (42 Pa.C.S. § 8371), people can file lawsuits against insurance companies when they act in bad faith.
When you make a valid claim on your policy, under Pennsylvania insurance regulations, your insurance company may have at least 25 days to acknowledge the claim and decide whether to accept it. The company has:
- 10 working days to acknowledge the claim and send the policyholder instructions and paperwork, including proof-of-loss forms.
- 15 working days to make a decision on the claim after receiving completed proof-of-loss forms. Naturally, there are exceptions based upon extenuating circumstances.
If your insurance company fails to adhere to time requirements and is using tactics to avoid settling, you may have valid legal grounds to file a bad faith insurance lawsuit. You may receive the original settlement amount with added interest and penalties.
Acting in bad faith to avoid paying may involve acting unreasonably in investigating, processing, or paying you for your claim, and may include the following:
- Failure to promptly and fairly settle a claim in which responsibility of the insurer is reasonably clear
- Unreasonable denial of benefits for a valid claim or failure to explain reasons for denial
- Major undervaluation of a claim or refusal to pay the full amount of claim owed
- Failure to investigate or unreasonable delay in investigating a claim
- Misrepresentation of benefits, coverage or other provisions of an insurance policy that are relevant to a claim
- Unreasonable interpretations of policy language to avoid payment
- Imposing arbitrary deadlines or time limits for making a claim that are not specified in the policy
- Failure to defend the insured against third party claims
- Failure to disclose policy limits
- Redefining what constitutes necessary medical procedures, home repairs or auto repairs in order to deny a partial or total claim
- Forcing a claimant into litigation in order to delay offering a fair settlement amount.
To win your bad faith case, our attorneys must prove the following elements by clear and convincing evidence:
- No reasonable basis existed for the denial of the benefits.
- The insurer knew or recklessly ignored its lack of reasonable basis in denying the claim.
In a successful bad faith case, you may win damages that include:
- The amount of the claim
- Interest on the amount of the claim at the prime interest rate plus 3% from the date that the claim was made
- Attorney’s fees and court costs
- Punitive damages.
In Pennsylvania, there is no jury trial, but rather it is a judge decision on bad faith. In Federal Court juries may be permitted.
If you find your insurer is doing anything to avoid paying, call Rieders Travis and let our attorneys handle negotiations for a fair settlement. Once insurance companies know you have an attorney on your side willing to go to court, they are more likely to settle in good faith.
Call (570) 323-8711 For Legal Help.
Can my Insurance Company Settle Without my Consent?
In Pennsylvania, the typical auto liability policy gives the insurance carrier the sole discretion to settle a claim in which they are defending you from allegations of negligence, without consent of the policyholder. In cases where the settlement is within the limits of the policy, the insurance company has virtually sole discretion. However, your liability insurance policy may require the insurer to consult with you and obtain your consent before settling. We would need to look at the insurance policy to know what the situation is.
Must I Accept an Insurance Company Offer?
You should never be negotiating with a liability insurance company on your own. If you have been injured by another party’s negligence or fault, you may be entitled to go beyond insurance and file a personal injury lawsuit in a Pennsylvania court.
Insurance companies often offer you a quick settlement, which is usually less than your case is worth. Once you accept their offer, you typically are not allowed to seek further damages, even if your medical condition worsens in the future. Our attorneys can evaluate insurance offers and determine if they are fair. We can investigate your case and identify all negligent parties who may be liable for causing your accident and hold them all accountable, as they all may have insurance and assets that can go toward a settlement. Let us examine all offers from insurers before you accept them.
In all candor, there are times that we will not accept a case once an individual has negotiated with an insurance company on their own. It would depend upon the situation.
Damages awards you may win in a personal injury lawsuit
This does not apply to bad faith claims against your insurance company. In a successful personal injury case, you may win a damage award that covers both your economic and non-economic damages.
Economic damages – cover expenses which can be objectively calculated, such as medical, therapy, and rehabilitation costs, costs of equipment such as wheelchairs, lost income from being unable to work, property damage, and funeral and burial costs if a death is involved.
Non-economic damages – are for losses which do not have a specific dollar value, such as mental and physical pain and suffering, the loss of enjoyment of life, and the loss of a marital relationship (consortium).
If your case is successful and you recover for your financial losses and pain and suffering, you will probably receive significantly more than the original offer from the insurance company.
Call Our Attorneys to Help with Your Insurance Company Settlements
Whether you have been in a vehicle accident or suffered another loss, if you have a problem getting an insurance company to make a fair settlement, call Rieders Travis for a free consultation. We are fully prepared to take on the most powerful insurance companies, hold them accountable for their wrongful conduct, and get you the settlement you deserve.
Do not delay. Prompt legal consultation can ensure the collection of relevant facts and the preservation of evidence.
Call Rieders, Travis, Dohrmann, Mowrey, Humphrey & Waters today at (570) 323-8711.