Missouri follows a traditional fault system for car accidents, which means you file a claim against the responsible party for your collision claim. While you might think that the insurance company will pay for your medical bills, property damage, lost wages, and other losses, some insurance companies act in bad faith to deny or unreasonably devalue valid claims. It’s important to recognize when a company is engaging in bad faith insurance practices and when to seek help from an experienced attorney.
What is Insurance Bad Faith?
Insurance bad faith refers to unlawful practices insurers engage in to deny valid claims or unreasonably reduce their value. Under R.S.Mo. § 375.420, you have the right to pursue damages against an insurance company when it unreasonably fails to pay for your losses. Insurance bad faith practices give rise to a separate cause of action from your automobile injury claim and can result in additional damages.
These practices can include an outright denial of a valid claim, giving false reasons why the company will cover only a small portion of your damages, or unreasonably delaying your claim. Missouri lists several bad faith insurance practices in R.S.Mo. § 357.1007. Some examples of these practices are detailed below.
1. Unreasonable Delays
Insurance companies operating in Missouri must follow state regulations for how long they take to process and investigate claims:
- Promptly: Provide claim forms and offer help to first-party claimants upon being notified of a claim
- 10 Business Days: Acknowledge receipt of a claim
- 15 Business Days: Communicate in writing to a first-party claimant that they’ve accepted or denied a claim. If it is a denial, they must provide a specific policy provision reference for the reason. When the insurance company needs more time to decide, it must notify the claimant in writing and give reasons for the delay.
- 30 Business Days: Investigate the claim within 30 days unless the claim’s complexity requires more time
Insurance companies sometimes delay valid claims because they hope the claimant will give up. If the insurance company appears to be unreasonably delaying your claim, talk to our lawyers about a potential bad faith insurance lawsuit.
2. Denying Claims Without Investigating Them
Insurance companies must investigate claims they receive. If an insurance company fails to investigate your claim and denies it without a valid reason, it could be engaging in bad faith tactics. Insurers might do this because they think you won’t appeal the denial.
3. Making Unreasonably Low Settlement Offers
Most insurance companies’ initial settlement offers are low. This is standard practice and is done because many people will accept initial offers. However, companies operating in bad faith will continue to refuse to offer fair settlements, especially when their insured’s liability is clear. Insurance companies might engage in this tactic when you represent yourself and don’t understand how much your claim might be worth. It’s best to work with an experienced attorney to properly value your claim to better assess the settlement offers you receive.
4. Misrepresenting the Policy Provisions and Available Coverage
Insurance companies that engage in bad faith insurance practices sometimes misrepresent the available coverage and provisions of their policies to claimants. An example might include an insurance company claiming that a trucking carrier only has $1 million in liability coverage when it also has an umbrella policy for excess coverage.
This is what occurred in the Georgia case of Prieto vs. Burkett, in which the defense lied about having only $1 million in liability coverage when the at-fault party had excess coverage. In that case, the plaintiff ultimately recovered $10.1 million in damages.
What to Do If Your Insurance Company Is Acting in Bad Faith
If the at-fault driver’s insurance company appears to be acting in bad faith, you should do all of the following:
- Retain an experienced attorney.
- Retain all correspondence from the insurance company, including emails and notices.
- Continue receiving medical care.
- File a complaint with the Missouri Department of Insurance.
- Consider filing a lawsuit for both your injuries and the company’s bad faith insurance practices.
Consult Our Lawyers
If you were injured in a car accident and believe the at-fault party’s insurance company is engaging in bad faith tactics, it’s important to seek prompt legal help. Contact the experienced attorneys at the Law Offices of Bryan Musgrave today to get started by calling 417-322-2222 or sending us a message online.