Archives: Bad Faith

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The Genuine Dispute Defense and Bad Faith

Insurers often seek to avoid liability for bad faith by asserting the “Genuine Dispute Doctrine.” Under the genuine dispute rule, an insurer’s coverage or claim decision may not be in bad faith when it mistakenly withholds policy benefits, if the mistake is reasonable and is based on a legitimate dispute as to the insurer’s liability.1… Continue Reading

Court Finds Unreasonable Underpayment of Claim Sufficient Evidence of Bad Faith to Survive Motion to Dismiss

It is generally understood that a disagreement as to scope or cost of damages is not enough to rise to the level of bad faith in first-party property damage cases. However, a recent case out of the Western District of Oklahoma held that evidence of unreasonable underpayment of claim was sufficient to survive a 12(b)(6) … Continue Reading

Bad Faith Finding in NFIP Flood Case

It is the general understanding when one brings a lawsuit on a flood claim under the National Flood Insurance Program (NFIP) that the only recovery available to the policyholder is actual damages. The policyholder is not entitled to attorney fees or bad faith (extra-contractual) damages, which might be recoverable in other first-party property damage cases. … Continue Reading

Lloyds Delaying Payment on Many Claims

Lately I have had several public insurance adjusters call me about a specific problem with Lloyds.1 The public adjuster and the Lloyds (third-party) adjuster agree on the scope and amount of damages on a claim. Then Lloyds never pays. It’s not that Lloyds refuses to pay. They just don’t pay, like for a real long … Continue Reading

Well…Another Bad Faith Case in Massachusetts

Shaun Harrington was subcontracted to install a well on the McLaughlins’ property (sorry for the bad pun in the title). Unfortunately, in July and August of 2003, this well starting pumping salt water onto the McLaughlin’s irrigation system causing extensive damage. A claim was submitted to Harrington’s insurer, American States Insurance Company (ASIC) on November … Continue Reading

Alabama Bad Faith: Part 1

I was recently approached by a policyholder inquiring whether he had a viable claim for bad faith under Alabama law. In responding to his inquiry I did quite a bit of research and will share my findings with you now in this two-part blog on Alabama Bad Faith.… Continue Reading

California Supreme Court Decides That Policyholder Attorney’s Fees Are Included to Calculate Punitive Damages

On May 5th, I blogged about an important case pending before the California Supreme Court—Nickerson v. Stonebridge Life Insurance Company—that was set to address an important issue for policyholders forced to sue their insurers for bad faith and punitive damages. You can check out my prior blog addressing the issues in the case here.… Continue Reading

California to Decide Whether Policyholder Attorney Fees Are Included to Calculate Punitive Damages

The California Supreme Court heard oral argument recently on an issue that is important to insurance policyholders forced to sue their insurers for bad faith and punitive damages: Whether an award of attorney fees should be included as compensatory damages for purposes of calculating the ratio between punitive and compensatory damages. The case is Nickerson … Continue Reading

Insurance Appraisal takes on the rules of Arbitration but Preserves Bad Faith in Hawai’i

Insurance is a heavily regulated industry and everyone who reads our daily blog knows that insurance rules and regulations vary by state and fall under each individual state’s jurisdiction. Hawai’i is no different and in a state whose insurance laws are still evolving, it is interesting to see that when it comes to appraisal in … Continue Reading

New Jersey Legislature Considers a Bad Faith Statute for Catastrophe Claims

Initially introduced in January 2014, Assembly Bill No. 231 made its way before New Jersey lawmakers during a committee hearing on December 10, 2015. The bill, "establishes a private cause of action for insureds or their assignees regarding unfair practices in the settlement or attempted settlement of insurance claims arising out of a declared disaster."… Continue Reading

California Bad Faith Revisited

As a property insurance attorney I am often asked whether bad faith damages are recoverable in California. Over the course of many years, California case law has changed and the recovery of bad faith damages, versus attorney fees and punitive damages, has evolved. Bad faith damages are tort damages while punitive damages are recoverable only … Continue Reading

Wal-Mart Sues for Bad Faith!

So you think your insurance company is going to be fair to you? After all, you have been paying them premiums for years and this is the first time you have asked them for anything? Think again. If there was ever evidence that insurance companies simply do not want to pay, no matter who you … Continue Reading

Insurance Companies Always Fight Requests for Production of Internal Claims Management Objectives and Goals

Many policyholders think that insurance company adjusters get an individual bonus on each claim for paying less than a certain amount. They distrust the insurance company adjuster and often creatively claim more, fearing that the property insurance adjuster will wrongfully reduce the eventual settlement. The truth is that collectively, many insurance companies pay bonus incentives … Continue Reading
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