We Stand Up To Insurance Companies And Fight For You 

Get Started
View of Hollywood Boulevard district in Los Angeles, California, US

Insurance agencies must investigate, indemnify and defend

On Behalf of | Feb 22, 2023 | Dealing with Insurance Companies |

If a motor vehicle collision occurs on a California highway, numerous entities may become involved in the aftermath of the incident. Any occupant of a vehicle that was hit may need immediate medical attention, which rescue workers can begin to provide, although a more complete examination can be performed at a hospital. In addition to rescue workers, police officers and insurance agencies may each have a role in assisting those involved in a car accident.  

Many recovering accident victims have encountered legal problems because of bad-faith insurance representatives, meaning that an insurance company failed in its duties. An insurance agency typically has three duties, which include investigating a claim and documenting its findings, as well as indemnification, which means paying a settlement or judgment rendered against a policyholder, up to the limits of the policy. An insurance company is also typically obligated to defend a policyholder against a claim.  

Failure to perform these duties may constitute bad faith 

If a policyholder believes that an insurance agency has acted in bad faith, meaning that it failed to carry out its duty to investigate, indemnify or defend, he or she may file a legal claim for breach of contract. In some states, including California, a victim of bad faith insurance may also file a tort claim to seek punitive damages against a company that unlawfully denied payment of a claim. If an insurance agency willfully or unreasonably denies benefits under a valid claim, there may be grounds for a lawsuit.  

Seeking justice regarding bad faith insurance 

Anyone in California who has been involved in a collision and believes that an insurance agency has acted in bad faith may request a meeting with an experienced attorney to discuss available legal options. An attorney can draft a demand letter, informing an insurance agency that a lawsuit will be filed in a certain amount of time unless a reasonable settlement is reached. If the agency fails to respond within the stated amount of time, an attorney can help the client pursue legal recourse.