November 13th, 2013
What Can I Do If I Am Being Mistreated by my Insurance Company?
We are bombarded every day with television advertisements from insurance companies promising to respond and protect their policyholders when disaster strikes. These promises are made with the hopes ofenticing more people to purchase policies from the insurer and increasing the premiums collected by the company. Insurance companies make money in two primary ways: 1) collecting premiums and 2) investment income, i.e. interest and dividends earned on the insurer's cash, stock and bond reserves. Paying claims reduces the insurer's cash on hand and, correspondingly, reduces the potential investment income which is realized. As a result, insurers are incentivized to delay paying claims and to minimize any amounts eventually paid and policyholders are left with unfulfilled promises.At Bordas and Bordas, we receive calls on a regular basis from policyholders who have been abandoned by their insurers after filing a legitimate claim under their own policies of insurance. All too often we hear about homes being damaged in a storm and the insurer attempting to deny the clearly covered claim by stating that the damage was not caused by the storm event but by ordinary wear and tear or lack of maintenance. Many times, we hear of homeowners who simply cannot find a contractor to do the work for the amount allocated by the insurer for repair and who are turned away by the insurer when they present evidence from a contractor that the actual cost of repairs far exceed the amount allocated by the insurer. More often than not, the insurer states that it is standing by its original estimate and the insured is left to seek legal help to secure the contractual benefits to which they are entitled.
Fortunately, both West Virginia and Ohio law provide some relief for policyholders who fall victim to an insurer's inappropriate claim handling conduct and desire to increase profits at the expense of its policyholders. The law places a higher duty upon insurance companies to act fairly and in good faith when dealing with its own policyholders presenting claims than it does when the insurance company is dealing with a third-party making a claim against one of its insureds. An insurance company is required to promptly pay all claims presented by its policyholders unless there are good, valid reasons to dispute the claim.
Insureds presenting claims under their own policies of insurance are entitled to be treated fairly and in good faith. The presentation of a claim should not be an adversarial process and an insurer is required to afford its insureds' interests at least equal regard as its own interests. An insured is entitled to all the benefits and coverage available under his or her policy to compensate him or her for acclaim in a timely fashion. Additionally, an insured is entitled to a full, prompt and fair evaluation of his or her claim for policy benefits, including payment of the full, reasonable value of his claim without unnecessary delay.
When an insurance company fails to honor these basic obligations, West Virginia allows an insured to present legal claims for both statutory violations and for the insurer's failure to act in good faith in connection with its handling of a claim. Under West Virginia law, an insured is entitled to recover not only the policy benefits to which he or she is entitled, but also damages for his or her annoyance, aggravation, inconvenience and frustration. Additionally, the insured may recover the attorney's fees and costs incurred in securing the policy benefits to which the insured was entitled and, in certain circumstances, punitive damages to deter the insurer from acting in a similar manner in the future. Likewise, under Ohio law, where an insurer's actions in investigating, handling, adjusting, negotiating and refusing to appropriately pay a claim were made under circumstances that did not furnish a reasonable justification therefore, the insured may recover similar damages. At Bordas & Bordas, we deal with claims arising from insurance company misconduct on a daily basis and are available for consultation to ascertain whether you may have additional remedies available to you under West Virginia and Ohio law.
This article is for informational purposes only and not for the purpose of providing legal advice. You should contact an attorney to obtain advice with respect to any particular issue or problem. Use of and access to this website or any of the email links contained within the site do not create an attorney-client relationship between Bordas & Bordas and the user or browser.