Home Insurance Bad Faith

Representing Bad Faith Insurance Victims

Coverage disputes that arise between insurance companies and policyholders may need to be resolved through litigation. Insurance companies have a duty of good faith and fair dealing in processing and adjusting claims under South Carolina Code of Laws, Title 38. The doctrine of utmost good faith is a minimum standard by which all parties entering a contract are legally obliged to act honestly and not withhold critical information or mislead one another. When an insurance company violates the doctrine of good faith, it can give rise to an insurance bad faith claim.

I represent clients the way I would want to be treated: with respect, honesty, and a commitment toward great results.”
- Julian Allen

How Do Insurance Coverage Disputes Arise?

Insurance policy language may be ambiguous and open to interpretation. Coverage issues can arise when an insurer interprets the terms of a policy in the insurance company’s favor. Disputes can arise as to the scope of coverage, who is covered, coverage endorsements, exclusions and limitations, and other matters. These disputes are often resolved through a declaratory judgment action, in which the court issues a ruling as to what certain policy language means under state statutes and case law and what is covered under the policy.

What Is Insurance Bad Faith in South Carolina?

Insurance bad faith refers to the refusal or failure of an insurance company to pay out on a legitimate insurance claim. Among other ways, insurance companies may commit bad faith by:

  • Denying a claim that should be covered under the policy
  • Failing to investigate a claim within a reasonable amount of time
  • Paying out only a portion of a claim
  • Delaying payment of a claim
  • Failing to make a good faith settlement offer
  • Failing to disclose policy exclusions and limitations before the policy is purchased
  • Making unreasonable demands on a policyholder to prove a covered loss
  • Misrepresenting the language of an insurance contract to a policyholder to avoid paying a claim

What Items Might Insurance Companies Fail to Compensate?

Americans today carry all types of insurance, for our homes, vehicles, healthcare, retirement, and in case of short or long-term disability. We include insurance premiums in our budget and pay them faithfully on a regular basis to have the protection we need in different areas of life. It can cause untold stress and financial hardship when insurance companies fail to pay out when the need for coverage arises. Insurers may fail to compensate for legitimate healthcare expenses, auto accidents, disability, fires, or other covered losses.

What Recourse Do You Have Under the Law?

Under state law, you are entitled to seek damages and attorney fees in a civil action against an insurance company for bad faith denial of insurance coverage. To prevail in such a claim, you must prove that the insurer acted unreasonably and without factual justification for its decision to deny benefits under the contract. Breach of contract cases are often tried along with bad faith cases.

What Damages Can You Recover for Insurance Bad Faith?

Recoverable damages for insurance bad faith are not limited to the amount of coverage that should have been provided under the policy. They may include consequential damages (special damages because of the injured party’s circumstances), attorney fees, and punitive damages, if the actions of the insurance company were willful or demonstrated reckless disregard of the rights of the claimant. Punitive damages may be awarded against an insurer for fraudulent breach of contract.

Legal Help for Insurance Coverage and Bad Faith Issues

At Allen Law, we have a background in insurance claims and extensive knowledge of both sides of insurance coverage and bad faith cases. Attorney Allen spent six years as an insurance defense attorney before beginning practice as a Charleston personal injury attorney. If an insurance company has acted in bad faith, delayed, or failed to pay a legitimate claim, call us at (843) 882-5005 to schedule a free consultation with a Charleston personal injury lawyer.