Insurance companies play an important role in our society. They help protect us from the financial consequences of accidents and injuries, so it is important to understand what they can and cannot do when it comes to providing coverage for your car accident case.
What is Bad Faith?
Bad faith insurance is a breach of contract, as per personal injury lawyer in Vaughan. A bad faith insurance claim can be filed against the at-fault party, who is either an insurer or an insured. The claimant must prove that the defendant had no good reason for denying coverage, or for refusing to pay out on their policy’s terms and conditions.
What Is Bad Faith Insurance?
Bad faith insurance is the failure of an insurer to uphold their end of the insurance contract. The insurer has a duty to act in good faith, meaning that they must handle claims and other matters in a way that demonstrates fairness and professionalism. If they do not, they may be liable for damages caused by your injuries as well as monetary losses incurred by you through litigation or settlement negotiations.
Bad faith insurance can mean a number of things, but in general, it refers to the insurer’s refusal to pay legitimate claims. There are many potential causes for bad faith insurance and they include-
The insurer doesn’t have a policy on file with yours or it has been canceled by your policyholder and no longer exists as an entity in its own right. This is common with small businesses that go out of business or have their coverage canceled by their customers when they stop paying premiums.
The insurer has made an error in processing your claim and is refusing to cover what was originally agreed upon at the time of settlement. The good news is that proving bad faith will help you avoid them altogether.
Damages for Bad Faith Insurance
If you’re wondering what damages can be awarded in a bad faith insurance case, it’s important to first understand that there are two types of cases: one in which the insurer was at fault and another where it wasn’t. In both scenarios, however, there are certain things which can be done by the court to compensate victims for their losses.
The most common type of case is when an insurance company denies coverage or pays too little after an accident occurs. This is called “bad faith” because the insurer intentionally sought to deny coverage or pay less than they should have—and this behavior amounts not only to financial harm but emotional distress as well.
Conclusion
Bad faith insurance is a common cause of car accident claims. If an insurer fails to uphold their end of the insurance contract, they can be held liable for damages. You should know how bad faith insurance works and what kind of damages you may be entitled to if you have been injured in a car accident during which your insurance company did not provide adequate coverage or pay out what was due on your claim due to bad faith tactics employed by the insurer’s employees.