Massachusetts has adopted a version of the model Unfair Claims Settlement Practices Act and recognizes a cause of action for bad faith against a first-party insurer.1 Mass. Gen. Laws Ch. 93A § 9 establishes a statutory cause of action for any person who has been injured by another person’s use or employment of any method, act, or practice declared to be unlawful by Mass. Gen. Laws Ch. 176D § 3(9), a violation of which may give rise to civil liability under 93A § 9.2 While each state generally has their own specific bad faith statute outlining what constitutes a “unfair” or “deceptive” act by an insurer, Massachusetts law includes conduct typically found throughout the country.
Continue Reading Bad Faith Conduct and Foreseeable Damages in Massachusetts

Insurance is your safety net. It is a contract made between you and your insurance company guaranteeing that, if anything were to happen to you, the agreed safety net will be provided. Insurance companies have a right to investigate the legitimacy of claims. However, insurance companies in Texas cannot reject legitimate claims, misrepresent policy terms, or engage in other specific “bad acts.”
Continue Reading Understanding Your Rights Under Chapter 542 of the Texas Insurance Code: Why it is Beneficial to Allow an Attorney to Assist You in the Process

Arizona has a strong interest in ensuring its residents are made whole for injuries sustained while in Arizona. Bryant v. Silverman, 146 Ariz. 41, 47, 703 P.2d 1190, 1196 (1985). Toward that end, it allows for injured plaintiffs to recover all damages caused by a tortfeasor, including economic and emotional damages. Rawlings v. Apodaca, 151 Ariz. 149, 161, 726 P.2d 565, 577 (1986).
Continue Reading Is Expert Testimony Required For a Jury To Award Emotional and Mental Distress Damages In Arizona?

Existing Arizona law allows recovery of emotional distress and mental anguish damages in cases of property damage. The Arizona Court of Appeals has already ruled in at least two different cases that when a person sustains loss to property, that person may recover emotional distress damages even if the tortfeasor did not intentionally cause the distress, and even though the distress is not severe. Farr v. Transamerica Occidental Life Ins. Co., 145 Ariz. 1, 7, 699 P.2d 376, 382 (App. 1984).
Continue Reading Recovering Emotional and Mental Distress Damages Caused By Property Loss In Arizona

Picture this. You have retained counsel to assist in enforcing your claim under your insurance policy. After a favorable appraisal, and payment of that award by the insurer, you receive a notice of nonrenewal stating that the insurer is electing not to renew the policy as “the risk no longer complies with underwriting guidelines.”
Continue Reading Policyholders’ Potential Bad Faith Claim for a Retaliatory Nonrenewal

Like the 50 states, the U.S. Virgin Islands allows policyholders to recover through multiple avenues, in the event of an insurance company’s refusal to pay a valid claim. Similarly, the USVI also allows a policyholder to bring a bad faith claim in addition to a breach of contract claim.
Continue Reading Insurance Bad Faith in the Virgin Islands: How To Properly Plead Insurance Claims Misconduct in The Virgin Islands

Shawnee Tabernacle Church (“Shawnee”) is a Congregation located in Monroe County, Pennsylvania. The church was insured by GuideOne Insurance (“GuideOne) with a policy that included the following language under the title “Pennsylvania Changes”:

Notice of Acceptance or Denial of Claim

Except as provided in 3 below, we will give you notice, within 15 working days after we receive a properly executed Proof of Loss that we:

A.) Accept your claim.

B.) Deny your claim; or

C.) Need more time to determine whether claim should be accepted or denied.

1) If we deny your claim such notice will be in writing and we will state any policy provision, condition or exclusion used as a basis of denial. If we need more time to determine whether your claim should be accepted or denied, the written notice will state the reason why more time is required.

2.) If we have not completed our investigation, we will notify you again, in writing, within 30 days after the initial notice as provided in i.e., above and thereafter every 45 days. The written notice will state why more time is needed to investigate your claim and when you may expect us to reach a decision on your claim.

3.) The notice procedures in 1 and 2 above do not apply if we have a reasonable basis, supported by specific information, to suspect that an insured has fraudulently caused or contributed to the loss by arson or other illegal activity; under such circumstances, we will notify you of the disposition of your claim within a period of time reasonable to allow full investigation of your claim, after we receive a properly executed Proof of Loss.


Continue Reading Pennsylvania Bad Faith Archives: Shawnee Tabernacle Church v. GuideOne Insurance

In 2007, a law became effective in Maryland that, for the first time, permitted insureds to sue their insurers for failing to act in good faith in settling their first party claims under a property insurance policy. The cause of action, which is found in Maryland Code § 3-1701, applies in actions to determine whether coverage exists under the relevant insurance policy, and also in actions to determine the extent to which the insured is entitled to receive payment from the insurer for a covered loss.
Continue Reading Insurance Bad Faith in Maryland: Part 1

Insurance companies owe their insureds a duty to fully and fairly investigate a property loss, which includes a comprehensive inspection to identify all damages associated to the claim. Unfortunately, insurance adjusters will sometimes utilize an “any port in the storm” style reason to deny a claim; the adjuster cannot point to a specific tangible basis for denial, instead relying on a hypothetical justification. In that situation, the adjuster’s denial stands in paradox to the insurer’s duty to investigate a claim.
Continue Reading Claim Denial Reason: Did the Insurance Company Show Their Work?