Insurance Bad Faith

What Is Bad Faith in Insurance?

In many states, drivers are required by state law to have a minimum amount of liability coverage. State laws vary as to the amount of insurance a driver is required to carry.

This is insurance to pay for damages to others if you cause an accident. You can pay for greater coverage if you wish. This may protect you from loss if you are found liable in a vehicular accident. Remember, liability insurance pays only to settle claims or pay judgments against you if you are found negligent.

bad faith insurance in texas

So What is ‘Bad Faith’ Insurance?

Bad faith insurance occurs when an insurance company fails to fulfill its obligations to YOU, the policyholder. This can involve refusing to pay a legitimate claim or failing to investigate and process a claim within a reasonable amount of time.

Insurance companies may engage in bad faith by misrepresenting the terms of an insurance contract to avoid paying a claim. They may also act in bad faith by not disclosing policy limitations and exclusions before a policy is purchased.

There are numerous ways an insurance company can operate in bad faith. If you suspect this behavior, you should or seek advice from the legal team at Funk and Associates.

Insurance Companies Are Cheating Austin Drivers – We Can Help

When you file a valid claim, you expect the insurance company to pay for your losses. But many insurers focus on their bottom line instead of your interests.

When an insurance company fails to investigate a claim in good faith and denies it without a reasonable basis, the insurer has violated its duties under Texas law.

To protect yourself against claims from other drivers or passengers in case of a vehicular accident, you can purchase a coverage known as “uninsured or underinsured motorist benefits”. This allows you to receive compensation from your own insurance company if a negligent driver has limited liability insurance.

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If the amount of your damages exceeds the negligent party’s coverage, you can make a claim under this coverage from your own company.

To cover medical bills, you will need to purchase an additional coverage called “medical payments”. Medical payments coverage may go by various names, but its intent is to pay for the medical needs of a driver or passengers. It only covers those who are in the insured car.

Collision coverage is another type of voluntary coverage you may wish to purchase. This covers repairs or replacement to your vehicle after an accident, regardless of who is at fault. There is usually a deductible on the amount paid. This allows you to have repairs on your vehicle if you are at fault, or if your car is damaged by someone who has no insurance or who flees the scene.

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