The mistreatment of a customer by an insurance company would provide that mistreated customer with grounds for a bad faith claim. A mistreated policyholder would be one that had not received the level of compensation that had been promised by the policy’s terms.
Choices faced by a mistreated customer
• Do without the expected compensation, or do without the expected level of compensation.
• Do without a timely delivery of the expected compensation; accept a delayed delivery.
• Take the insurance company to court
It is essential that the damages must be paid by the sued company which includes the promised compensation for the policyholder. The possible punitive damages may be limited to a specific level in some states.
Legal assistance for those policyholders that want to charge an insurance company with bad faith practices
A personal injury lawyer might agree to take such a case on a contingency basis. Hence, the policyholder would only pay the lawyer if the case proved successful.
What would be the likely chances for winning a lawsuit that represented a policyholder’s response to bad faith practices?
That would depend on the availability of evidence that the policy had promised something that the insurance company had failed to deliver. It would also depend on the financial health of the sued company.
Auto insurance companies have limited funds. Each of them is supposed to be paying money to those customers that were involved in an accident. If a policyholder has been held responsible for an accident, then the company must pay for the policyholder’s defense lawyer.
If the money going out were to exceed the amount coming in, the company could go bankrupt. If that were to be the case, the sued company would be unable to pay the requested damages. The court could not force the payment of money that the company did not have. Still, that should not keep any mistreated policyholder from filing a lawsuit. If the sued company were in sound financial health, then it should appreciate the message that the policyholder/plaintiff is sending. A smart company would respond to that message by delivering what had been promised.
That promised delivery might be a certain amount of money, as part of a compensation package. Alternatively, it might be an agreement to cover the costs of an accident. By the same token, that promise could relate to the timing for delivery of a compensation package.
A personal injury lawyer in Kitchener would understand what promise had been broken. Consequently, a personal injury lawyer would understand what damages to seek. In a courtroom, the judge would get to decide whether of not the company’s actions were such that the court should increase the size of the damage award by adding punitive damages, as well.