When you enter into an insurance contract, sometimes you pay premiums for years and years before you ever need to make a claim. When you pay these premiums, you do so with the belief that when and if your time of need comes, your insurer will pay you fairly and will provide you with the benefits promised under the policy.
Unfortunately, sometimes an insurance company does not live up to its end of the bargain. When this occurs, it is time to hire an insurance bad faith attorney for legal help.
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Insurance policies are actually contracted with your insurance company in which you agree to pay premiums and the insurance company promises that they will cover you for certain events in exchange for the payment of those premiums. The contract of insurance outlines when an insurer will pay and what your obligations are. However, the law also imposes another contractual requirement that is not specifically outlined in your insurance policy: the obligation of good faith and fair dealing.
The obligation of good faith is referred to as the covenant of good faith and fair dealing. It essentially indicates that the insurance company promises to act fairly in paying claims. When the insurance company does not act in a fair and reasonable manner, they are considered to be engaged in bad faith. When this occurs, you can bring a bad-faith lawsuit.