How Our Experienced Texas Bad Faith Insurance Lawyer Will Help You
The Texas bad faith insurance lawyers at Wyly & Cook will examine your policy to determine if your insurer has made an unreasonable delay in processing your claim, paid less than fair market value on your claim, or improperly denied your claim. We will pursue payment from your insurer by way of negotiation and/or litigation as is best suited for each case. Further, if your insurer breached its duties to you under the Texas Insurance Code, you may be entitled to additional damages and attorney’s fees (beyond those required to be paid pursuant to the terms of your policy).
Insurance can provide the best financial protection for yourself and your family during times that are extremely stressful. However, there’s no guarantee that your insurance will protect you from being “cut off” by your insurance provider when they act in bad faith or deny your claim.
After an accident it’s normal to feel overwhelmed and stress, which is never a good state of mind for making important decisions. Add in the stress of a sudden influx of bills that feel impossible to pay and you could be more vulnerable to falling for misleading information and not taking the time to research and understand your rights after an accident.
Even though your insurance company deceived you into giving up a claim (payment) you were entitled to receive under the law, your insurance company may still be held accountable for their actions.
Therefore, you should seek out an experienced Bad Faith Insurance Attorney who is knowledgeable about all the tactics and loopholes used by insurance companies to avoid paying claims.
Our team at Wyly & Cook helps people like you obtain their rightful insurance payments as well as recover damages against them when insurers violate Texas law.
We prefer to give you the facts straight up, instead of hiding the truth behind fine print like many insurance companies do. Call us today for a free initial consultation to talk about your bad faith insurance claim and the compensation that may be available.
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Bad Faith Tactics of Insurance Companies
Insurance companies run like most businesses; their first priority is profit. The biggest expense in that profit picture is the cost of payouts when a claim comes due.
It is no surprise then that an insurance company’s interest may not always be aligned with yours, but Texas law requires insurance companies to follow specific fair claims-handling practices.
As such, the insurance companies may use one or more of these three primary tactics to delay, underpay, or deny claims:
- Delay: Unreasonably delaying your claim by continually asking for unneeded documentation or details in an effort to avoid deciding if you have coverage under your insurance. Even though you submitted all documentation you were required to, some insurance adjusters could attempt to delay the entire claim process in hopes that you become frustrated enough to just quit and walk away.
Texas Statutes have established timelines (deadlines) for when the Insurer must notify you they received your claim, investigate your claim, decide whether to accept or deny your claim, and pay out the amount due to you. Depending on the specifics of your case, failing to meet those deadlines may allow you to seek additional remedies under the statute.
- Underpay: Offering substantially less than what is due for damage that is covered under your policy once it becomes evident they are liable and therefore owe you more money under the terms of your policy.
- Deny: Declining a valid claim, and failing to provide the claimant a reasonable explanation within a short time frame after denial as required by the policy, facts, and applicable laws governing your insurance.
Delayed Payment
Can a Texas insurance company still be liable for bad faith if it eventually pays the claim after months of delay?
“A Texas insurance company can absolutely be held liable if it pays a claim after months of delay. The reason for that is the Texas Insurance Code imposes harsh penalties on insurance companies when they fail to pay within certain deadlines.
Those penalties can be up to 18% interest penalties per year, as well as attorney fees. In addition to that, if they delay payment after a certain amount of time when they have all the information reasonably required to pay the claim, they could potentially be held liable for what are called treble damages, which are three times actual damages.”
The Benefits of Working With A Seasoned Insurance Bad Faith Lawyer
If you believe that your insurance company was using deceitful methods, your lawyer can investigate the circumstances and help determine whether you have a viable case. Your insurance company also knows this.
A seasoned bad-faith attorney can guide you through a detailed investigation to see if your insurance company violated your rights.
Our team will advocate for you if your insurance company abuses their power of good-faith bargaining by delaying payment, short-changing you on payment, or simply denying your claim altogether.
Our goal here at Wyly & Cook is to work along side you to be sure you understand all of your legal options based on the facts of your unique case, communicate clearly with you through all the steps of your case and work to obtain the best possible results.
Damages for Bad Faith
What is compensation for an insurance company’s wrongful conduct?
I’m sure that many people have wondered what the benefit is in hiring an attorney after your insurance company has put you through such a difficult time with the stress of dealing with them physically, mentally, and financially.
Because of Texas’ bad faith insurance law, you may be entitled to more money than just the amount of your basic claim payment.
Our lawyers at Wyly & Cook represent people in Texas who have been wronged by insurance companies, using our knowledge of insurance policies and the Texas legal system to seek remedies on behalf of our clients, which can include:
- The covered benefits owed under your insurance contract.
- Damages beyond those owed as a result of the terms of your contract (or statutory remedies) where applicable under Texas state laws.
- Your reasonable and necessary attorney’s fees if they are recoverable.
- Compensation for emotional distress.
Understanding Legal Action Surrounding Bad Faith
We understand that you could be very frustrated after unsuccessfully working with your insurance company. However, it’s important that you not rush immediately into a lawsuit if your insurance company denies your claim. To get a clear understanding of your rights, the next step would be to consult with an attorney so you don’t miss any critical deadlines. Here are some things you want to verify before moving forward:
- Was your insurance policy active at the time of loss?
- That your insurance policy covers the damage/losses that you are making a claim for.
- Did you submit your insurance claim with all the necessary legal and policy requirements?
Even if you’re unsure of the above, you can call the experienced bad faith insurance attorneys at Wyly & Cook to discuss your case and ask any questions that you have. our team can step in to investigate your insurance company’s possible bad-faith behavior. We’ll review all the evidence, explain our findings and ultimately give our recommendation on if you should pursue a lawsuit against the insurance company using one (or both) of the methods below:
1. Common-Law-Bad-Faith
Common-law-bad-faith claims are derived from an insurer’s duty of good faith and fair dealing, which arises out of its special relationship with the insured.
To win a common law bad faith claim, your attorney generally needs to show that the insurance company withheld or denied your payment when it knew or should have known its liability was reasonably clear.
2. Statutory-Bad-Faith
The Texas Insurance Code provides remedies for unlawful claim delays or material misrepresentation(s), provided that the conduct meets the requirements therein.
In accordance with Chapter 541 of the Texas Insurance Code, there are numerous other avenues for which you may pursue legal action for unfair claims settlement practices, including but not limited to:
- Misrepresenting terms of your policy;
- Failure to pay a settled liability;
- Lack of reasonable cause to deny your claim;
- Failure to process or pay a covered claim in a reasonable time frame; and
- Failure to adequately investigate prior to acting on your claim.
In addition to filing an insurance claim under Texas law, time frames are established by statute as to when an insurer must respond to and process a claim submitted by you. Based upon specific circumstances, failing to timely comply with the applicable statutory deadlines may result in your entitlement to pursue other statutory remedies that are available.
Depending on the exact facts around your claim, the burden of proof for certain elements of your case may lie with you. An experienced bad-faith insurance attorney can step in to help you evaluate what your legal options are, support you in that burden of proof, and pursue all possible compensation available under Texas law.
One important step your lawyer must take prior to filing a bad faith insurance claim in Texas is to provide written notice of at least sixty-one (61) days to the insurance company; however, exceptions exist. In addition, certain property damage claims require additional notice requirements and/or procedures prior to filing your claim.
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What is Bad Faith Insurance?
Insurance companies may engage in bad faith by unreasonably delaying, denying, or underpaying legitimate insurance claims as required by law.
Even if your insurance company violated Texas Insurance Law, it doesn’t automatically give you the ability to pursue extra damages. There are three main things that can affect your entitlement to compensation: the terms in your insurance policy, how the insurance company conducted itself, and what type of harm was suffered from the violation.
How Do Insurance Companies Act in Bad Faith?
It is easy to use subjective terms like “unfair” and “reckless” when making accusations about bad faith practices by your insurance company; however, it will be difficult to demonstrate evidence of bad faith in a courtroom unless you are able to show through specific examples how they acted in bad faith.
Here are some examples of bad faith insurance practices:
- If they intentionally delayed or denied your insurance claim with no reasonable explanation.
- If they say that they never received your claim when they did.
- If they don’t conduct a reasonable and timely investigation into your insurance claim.
- If they refuse to pay your claim even if the obligation to pay is reasonably clear.
- Pressure you to accept substantially less than the amount owed under your policy.
- Fail to provide you with legally required notification of any changes made to your policy that would affect your claim.
- If they create give you additional paperwork to complete that make you or other parties important to your claim fill out with information they already have.
- If they misrepresent the details of your insurance policy or the extent of your insurance claim.
- If they withhold important information about your insurance claim.
- If they wrongly accuse you of doing something wrong or illegal.
- If they discourage you from hiring an attorney to represent you.
- If they try to intimidate you into not following through with your insurance claim.
How Can Your Attorney Help You With Your Bad Faith Insurance Claim?
The bad faith insurance attorneys here at Wyly & Cook are educated and experienced when it comes to dealing with unfair or unlawful insurance practices. They understand the laws and have the deep knowledge needed to guide you through your claim process step-by-step.
Those who are inexperienced in Texas Insurance Law could be at a disadvantage when it comes to identifying and challenging their insurance company’s violation(s) of fair claims handling practices.
Insurance companies often employ sophisticated forms of fraudulent behavior, including attempting to discourage you from talking to and hiring an attorney to represent you. They can go so far as to use misrepresentation, coercion, or even intimidation all with the goal of stopping you from getting an attorney.
When you decide to hire an experienced bad faith insurance attorney, you have leveled the playing field. Attorneys with experience handling these types of cases can ensure that an insurance company can’t intimidate you into accepting less than what your claim is worth underTexas law.
One of the first ways your attorney can help is by explaining complex language within your insurance policy and protecting you against any misleading or intimidating tactics by the insurance company.
The second way is by having the attorney review all evidence related to the claim, submit the claim on behalf of his/her client, communicate with all necessary parties (i.e., insurance adjusters, medical professionals, etc.), and represent the client in court if needed. Your lawyer is able to deal with most of the legal process while helping you understand what information you need to provide, relevant evidence you should protect, and which deadlines to comply with.
You hired your attorney so they can step into handle the legal process. They will do the heavy lifting and work with you to get any important information, preserve evidence and meet any important deadlines.
Claims made under Texas law for bad-faith insurance must be submitted in writing before time limits expire. Chapter 541 claims usually have a statute-of-limitations time period of 2 years. Each case has its own set of rules as to how long you have to complete certain discoveries and requests for extensions. Therefore, it is very important that you file a claim as soon as possible after the loss.
What Kinds Of Damages Are Possible When An Insurance Company Commits "Bad Faith" On My Insurance Claim?
You should speak with a lawyer first and set your expectations so that they know what to expect. Depending on the unique facts of your case, damages and other compensation may be available to you, such as:
- Enhanced damages of up to three times actual damages in qualifying cases involving knowing violations of applicable Texas insurance law.
- Necessary attorneys’ fees, plus recoverable court costs and interest if applicable.
- Damages for your emotional distress.
- Punitive damages could also be available of the insurance company’s misconduct is sufficient enough to meet the heightened standards under Texas law.
Another important point to know. There are certain property damage insurance cases where Texas Law will limit your recoverable attorneys’ fees, as well as require you to take certain steps prior to filing a lawsuit.
What's The Difference Between Negligence And Bad Faith?
In order to prevail on an Insurance bad faith claim, you typically need to demonstrate that the insurance company either failed to pay or delayed payment of a claim knowing, or having reason to know, their liability was reasonably clear or otherwise violated some law.
The general difference is that negligence is when someone fails to act with reasonable care for others; however, bad faith relates to violation of the insurer’s obligation to properly handle claims. Damages that you will be able to recover from an insurance company depend on which legal claims you are able to bring against them and what damages or losses you have been able to document.
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