Your insurance policy is a contract between you and your insurance company. When you submit a claim to your insurance company, the company is required to do a thorough investigation of that claim. If the claim is legitimate, the insurance company is to provide your benefits promptly and without delay. Parties to a contract have an obligation to act in good faith towards each other. When the insurance company fails to act in good faith by unnecessarily delaying investigation or payment or refusing to pay a legitimate claim, you may have a right to sue your insurer under the theory of bad faith.
In the state of Colorado, bad faith claims are both common law tort or statutory. Proving bad faith requires that you prove that the insurance company failed to honor the policy and the insurance company had no reasonable reason for the delay or denial. Under common law tort bad faith, you must show that this delay and/or denial was done willfully.
The ways in which an insurer can commit bad faith includes, but is not limited to, failing to investigate a claim within a reasonable time, failing to pay benefits without cause, unreasonably delaying or a denying a claim, undervaluing a claim, or an unfair cancellation of an insurance policy.
If you believe that your insurance company is engaging in bad faith in resolving your claims, please contact The Sawaya Law Firm. Our attorneys are skilled at dealing with insurance companies and protecting your rights under your insurance contract.