Can I Sue an Insurance Company?
Although any type of lawsuit can be daunting — particularly without knowledgeable legal representation — going up against an insurance company in court can be downright terrifying. Like David going up against Goliath, the balance of power is very much in a large insurance company’s favor when an individual decides to sue.
Nevertheless, in some cases, suing an insurance company is necessary. In this post, we discuss some of the types of lawsuits that can be filed against insurance companies, along with the process for suing them.
What Kinds of Lawsuits Can be Filed Against Insurance Companies, and Why?
Often, a suit against an insurance company is based on the negligent behavior of its insured party. For example, suppose you get into a car accident, and the other driver is clearly at fault according to the laws of your state. If their insurance company refuses to pay out on your claim, and liability is reasonably clear, then you should be compensated, and it may be necessary to bring a lawsuit against the company to recover damages.
Other cases involve a lawsuit against your own insurance company, often for breach of contract. When you purchase insurance, you enter into an agreement with the company — in return for your premium payments, the insurance company promises to pay out for covered losses. In the event that the company fails to do so — for example, by not paying in a timely fashion or failing to pay for damages to your home that should be covered under your homeowner’s policy — a breach of contract claim may be brought. In addition, some cases arise because an insurance company fails to defend you in a lawsuit, even though the claims against you should be covered by your liability policy.
In some cases, the insurance company can be sued for bad faith, or for violation of consumer protection laws. Bad faith occurs where the company acts in reckless disregard of the facts of the situation — for example, if they blatantly misrepresent the terms of your insurance contract to avoid paying a claim. A consumer protection claim is possible where the insurance company violates a state or federal law that is intended to protect consumers — for example, a scheme to collect premiums from consumers with no intention of paying out any corresponding claims.
What’s the Process of Suing an Insurance Company?
First and foremost, before you file suit, you will want to ensure that you consult with a knowledgeable attorney who has significant experience bringing actions against insurance companies. Negotiating with insurance providers requires the expertise to dodge their sophisticated tactics and apply pressure until they have no choice but to offer you a fair settlement. While anyone can act as their own representative in a lawsuit, it is difficult to manage such a fraught and complex situation without the help of a lawyer. After all, the insurance company will have its own team of experienced lawyers ready to do battle.
You should make sure you follow the insurance company’s reporting processes before filing suit. In many cases, if you are the insured, you must notify the insurance company of your claim. In fact, your insurance policy agreement may contain a clause that you have to “exhaust all available remedies” before you file suit. This could include the need to request a hearing, particularly if your claim resulted in a denial.
Be sure you document every interaction and correspondence with the insurance company and its employees. Keep detailed records of your insured property, as well as any expenses you have incurred as a result of the insurance company’s failure to pay. Expenses can include medical bills, lost wages, repairs, and attorney’s fees, among others.
Depending on your claim, you will need to choose the proper court to bring your case. It is imperative to investigate the circumstances and prepare the facts of your case. For example, if you have a personal injury claim stemming from an accident, it is essential to document everything about the scene, as well as any interaction with the other party and their insurance company. An experienced attorney can help prepare a lawsuit that takes into account all of the factual issues and legal arguments needed to present an effective case.
How Can FVF Help?
You may be wondering: can you sue an insurance company? We have the experience necessary to go up against an insurance company. At FVF, we are committed to securing positive outcomes for our clients. We also want to equip anyone who may be unsure how to proceed with securing the resources they need to make informed decisions. In support of that goal, we offer free, no-pressure case consultations. During your consultation, we will discuss the unique circumstances of your case and the best strategy for securing fair financial recovery.
No matter what step you decide to take after speaking with us, we hope to give you more clarity and confidence moving forward. Contact us today to schedule a free consultation with an insurance claim lawyer near you.