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Can you sue your insurance company for bad faith?

On Behalf of | Mar 5, 2024 | Personal Injury

Whether it is for work or for personal use, having an insurance policy is a smart move. In the event something happens to you, it can be your safety net ensuring compensation and coverage for you and your beneficiaries.  

Unfortunately, insurance companies aren’t always willing to help policyholders with their insurance claims, and they typically try to avoid paying out as much as policyholders deserve. Under these circumstances, you may be wondering what, if any, legal options you have. 

What challenges can you possibly face when claiming your compensation?  

Most people don’t like dealing with insurance companies. Some of the issues people might have when filing a claim with insurance include: 

  • Extensive delays in releasing the compensation  
  • Misrepresentation of a material fact or policy provision included in your coverage 
  • Failure to conduct a fair and thorough investigation  
  • Denying a claim without a valid reason  

In Texas, insurance firms cannot reject legitimate claims or engage in acts that are in “bad faith.” These include actions that are coercive, deceptive or otherwise inappropriate to avoid paying out what policyholders should receive. If they do, they can and should be accountable for their misconduct. 

Legal options can be available 

If you think your insurance company is not doing its best to manage your claims despite following protocol and giving the necessary documents, you can file a bad-faith lawsuit.  

Before filing for a lawsuit, make sure you document all your conversations with your insurance company. Choose to communicate either via email, text messages or a written letter to certify dates and details. In case you head for a lawsuit, you have proof to back up your claims of your insurance firm not being diligent when it comes to your compensation.