How can I sue my insurance company for a car accident claim denial?
If you’ve been in a car accident and your car insurance carrier is denying your claim, you’ve got a few options, but suing the insurance company isn’t usually the best one.
A lawsuit against your own insurer over a claim denial is usually referred to as a “bad faith” lawsuit, meaning that the carrier denied your claim in “bad faith” -- in other words, in violation of its obligation to deal fairly with policy holders, properly investigate all claims, and pay out compensation for any covered losses.
What you would need to prove in order to bring a successful bad faith lawsuit depends on which state you live in. Some states require bad faith plaintiffs to prove that the insurer failed to make a reasonable investigation into the merits of the claim; other states require proof that insurer ignored obvious information showing that the claim was valid; still other states require a showing of some kind of intentional misconduct or willful ignorance on the part of the insurer. These can all be tough elements to prove.
It’s true that car insurance companies are in the business of making money, and they may not always put your best interests ahead of their profit margins, that doesn’t mean that they’re going to do something as foolish as risk a costly bad faith judgment rather than pay out a few thousand dollars to resolve a policy holder’s claim. That’s just bad business.
If you’ve made a claim with your car accident carrier after an accident, and the claim has been denied outright (we’re not talking about a lowball settlement offer here), the first thing to do is take a long, hard, objective look at the accident and the kind of claim you’re making. Maybe you’re asking for thousands of dollars as compensation for injuries, but you’ve got no records showing you obtained any kind of corresponding medical treatment. Maybe a vehicle inspection has revealed evidence that the damage to your vehicle occurred well before you say it did.
If your claim was denied, and you think the denial was a wrongful one, it may be time to discuss your case with an experienced attorney. That way you’ll get an objective evaluation of the validity of your car accident injury claim, and you’ll also get an idea of the merits of any bad faith insurance lawsuit you’re thinking about filing.