Understanding Insurance Bad Faith Tactics
Nov. 22, 2022
After a car accident caused by someone else, the best-case scenario is that the at-fault driver’s insurance company would compensate you fairly for the injuries and damages you sustained. Moreover, you hope you don’t have to spend months or even years fighting the insurance company to get the settlement you justly deserve.
Unfortunately, that is not how insurance companies work. The way they process claims is driven by a desire to pay as little as possible, if any at all. Like most businesses, their goal is to hang onto their money and bolster their profits. One way this happens is through bad-faith tactics. In order to fight against these tactics is having an attorney by your side to represent you.
That is what we do at Gama Law Firm. We fight diligently with our experience and knowledge of standard operating procedures of insurance companies and how to counter them. From our office in Aurora, Colorado, we fight for our clients injured in the surrounding area, including Denver, Castle Pines, Centennial, or Parker, Colorado, so reach out for skilled advocacy today.
Insurance Bad Faith Tactics
Bad-faith tactics are, broadly, unfair or dishonest insurance practices. They can range from denying a claim for no reason to delaying a response. Sadly, they are often effective, especially if you don’t have a skilled personal injury attorney by your side.
Understanding possible bad faith tactics can help you be empowered to fight against them. Take those first steps towards the compensation you deserve.
Insurance Companies Lowball the First Settlement Offer
If the insurance company doesn’t send you a denial letter right away, it may instead extend an initial offer in full settlement of your personal injury claim for much less than it is worth. The company does that because it hopes you will accept the first settlement offer. This could save them a significant sum of money.
Insurance companies count on your vulnerabilities to accept this offer. Your mounting medical bills, household bills, and possible lost work hours leave you in that vulnerable place. However, do not accept the first offer without talking with an attorney first.
In fact, you should never accept a settlement offer until you know your cumulative medical expenses after a car accident, including current and future expenses. To know how much your damages should be, you should wait until you recover from your injuries to the extent you possibly can, which may not return you to your health status prior to the accident. This is referred to as “maximum medical improvement (MMI),” and it can take a very long time for you to reach it, so you can’t be in a rush to settle.
Insurance Companies Use Delay Tactics
Long delays in communication from the insurance company is another common strategy. The adjuster will ask you to submit certain information right away, then you will hear nothing for weeks or longer. You may call the adjuster repeatedly, only to reach their voicemail and not have your calls returned.
Companies do this for two reasons. First, waiting can make you nervous and desperate to settle quickly for too little. Second, waiting can make you lose hope so you just drop the claim.
Colorado law does not require insurance companies to respond within a specific amount of time, but the law does require them to do so “reasonably promptly.” Of course, that duration is rife for multiple interpretations, but the statute of limitations for personal injury claims resulting from auto accidents is only three years in Colorado. “Reasonably promptly” in that context should be relatively quick.
Insurance Companies Will Not Conduct a Thorough Investigation of the Crash
The assignment of fault in a Colorado car crash is vital to your claim. The state recognizes modified comparative fault, so your percentage of fault must be no more than 50%, or you surrender your right to pursue a claim against the other driver. For this reason, the adjuster could simply assert that you were more than half the cause of the crash because your comparative fault would let them deny your claim. Even if the adjuster assigns less than 50% without fully investigating the circumstances of the crash to confirm fault, your settlement would be reduced by any percentage of fault it assigns to you. If that is 40% comparative negligence, and the settlement is $100,000, you would receive only $60,000 and the insurer pockets the rest.
If you have a personal injury attorney represent you, your attorney will conduct a thorough investigation and place fault where fault is due.
Insurance Companies Misrepresent Coverage
Insurance companies will avoid providing you with a copy of its insured’s liability policy, often until it is compelled to do so in the discovery process after you file a lawsuit. Until then, the only information you have to rely on regarding what is covered, exceptions, and liability policy limits, is from the adjuster who counts on you to simply accept their word.
The adjuster will not volunteer information if you fail to ask for it specifically and with documentation. Moreover, they may take liberties with coverage exceptions, attempting to apply them to your claim. Without reading a copy of the policy itself, you will not know if what the adjuster purports to be true really is.
Colorado’s Unfair Practices Act
Colorado’s Unfair Practices Act protects consumers. The state’s bad faith law requires insurers to act reasonably or be penalized for failing to do so. In fact, in 2018, the Colorado Supreme Court upheld a lower court’s decision that insurance companies failing to act in good faith could pay the plaintiff’s damages threefold.
Insurance companies may be motivated by profits to deny or settle your claim for far less than what is just. However, the Supreme Court has upheld the extreme penalty they may pay for doing so.
Your Attorney’s Role in a Claim and Settlement
Do you know what the value of your personal injury claim should be? Do you know how to negotiate with insurance companies? Do you know how to document proof of the other driver’s negligence? Do you know how to ensure the adjuster is being honest?
For most injury victims, the answers to these questions would be “no.” For the personal injury attorneys at Gama Law Firm, the answers are all a resounding “yes.” We will handle everything involved in your claim while you make all the decisions regarding it. Moreover, if an insurance company is operating in bad faith, we will know, and we can represent you in a bad faith claim as well.
Strong & Dependable Representation
Colorado’s bad faith law allows us to protect you. From Gama Law Firm, our attorneys are more than ready to protect you from bad faith tactics. We know how insurance companies work, and we use our knowledge and experience to make sure you don’t become a victim twice.
You’ve already experienced enough after being a victim of a car accident, so reach out to us so you can focus on what’s most important. We serve those in Aurora, Colorado, and the surrounding areas of Denver, Castle Pines, Centennial, and Parker. Contact us to schedule a free case consultation.