5 Bad Faith Insurance Practices to Watch for After Your Car Accident

By Greg Kohn

Sadly, you cannot always believe what you see on television ads. Some insurance companies are not the best of neighbors, and they are not always there to give you a helping hand. Insurance companies are for-profit businesses. They are in business to earn as much profit as possible for their shareholders and investors. Paying large claims for car accidents is not profitable. Most insurance companies are reputable and treat accident victims fairly, even if they try to pay as little as possible to settle the claim. Unfortunately, some insurance companies cross the line. The use of bad faith insurance practices to avoid paying valid accident claims. If you suspect you are the victim of bad faith insurance practices, you need to contact a New Jersey car accident attorney immediately to discuss your case.

Five Bad Faith Insurance Practices Commonly Used to Deny and Undervalue Injury Claims

1. Failing to Conduct a Proper Investigation

Insurance companies have a duty to conduct an investigation when they receive an insurance claim. The company cannot make a good faith effort to determine whether the insurance policy covers the injury claim until it conducts an investigation. Denying a claim without conducting an investigation is a sign of bad faith practices.

2. Denying an Injury Claim Without a Valid Reason

If an insurance company denies an injury claim, it should provide a written explanation of the reason for the denial. For example, the insurance company denies the claim because the policy had lapsed for nonpayment, or the insurance company denies the claim because it determines that the insured driver was not at fault for the cause of the accident. If your injury claim is denied, with or without a written reason, you need to seek advice from a personal injury attorney immediately. 

3. Failing to Pay a Valid Claim

If the insurance company accepts responsibility for a claim and agrees to a settlement amount, the company has a duty to make timely payment to the injured victim. Delaying payment or refusing to pay a valid claim is another sign of bad faith insurance practices. Failing to pay a valid claim could result in additional damages and compensation for the injury victim.

4. Changing or Canceling an Insurance Policy

An insurance company that changes or cancels an insurance policy without just cause or the consent of the policyholder after a claim is made might be guilty of bad faith insurance practices. Some companies may attempt to modify the insurance policy to avoid paying a valid insurance claim, such as modifying the covered drivers or the dates of coverage.

5. Misrepresenting the Language of the Policy or Applicable Law

An insurance company may try to convince an injured victim that he is not entitled to compensation or full compensation by misrepresenting the language of the insurance policy or the applicable laws governing the policy or the injury. As part of its duty to act in good faith and fair dealing, the company must be truthful in all statements regarding the policy and the law. If something does not sound correct, talk to an attorney immediately.

Contact a New Jersey Car Accident Attorney for Help

If an insurance company denies your personal injury claim, pressures you to accept a low offer, unreasonably delays your claim, or otherwise acts in any way detrimental to your best interests, it is wise to contact a New Jersey car accident attorney immediately to discuss your claim. Schedule a consultation with our New Jersey personal injury lawyers today. You could be entitled to additional compensation for damages if the insurance company is guilty of bad faith insurance practices. 

About the Author
Greg Kohn is a partner at Nagel Rice and specializes in complex civil litigation cases, including professional malpractice, personal injury, class actions, wrongful death, products liability, and commercial litigation.  He has extensive experience representing clients in both state and federal court. Greg has tried many jury trials to verdict and has recovered over $50 million in settlements and verdicts in all types of personal injury matters including automobile accidents, wrongful death cases, slip and falls, and other catastrophic injury cases. Greg also handles medical malpractice cases, involving misdiagnoses, wrongful birth, and delayed cancer diagnosis. If you have questions regarding this article, you can contact Greg here.