An insurance company, whether it is health insurance, automobile insurance, home insurance, property/renter’s insurance, or commercial insurance, is first and foremost a business. Like all businesses, an insurance company’s primary objective is to turn as large a profit as possible and not to compensate the people who pay what amounts to collectively millions of dollars in monthly premiums each month.
Most insurance companies do honor claims in what is legally known as “good faith.” If a fender is damaged in a car accident, the check covering the repair can come very quickly. However, sometimes the check may not cover the entire repair (minus whatever deductible a customer may have) or the insurance company wants the repair taken care of at a repair facility of their choosing. There are even times, particularly in an automobile collision, where one insurer (rightly or wrongly) will want the other insurer to take care of the claim, leaving you, the insured, to fend for yourself. Though making a quick payment or negotiating with the insurance companies yourself might seem tempting, many of the insured who try this approach end up being grossly taken advantage of since they are unaware of their legal rights.
In Pennsylvania, New Jersey and several other states there are “bad faith” statutes in effect concerning insurance companies. These statutes provide guidelines insurance companies must abide by, as well as recourse for you, the insured. Examples of claims being handled in “bad faith” include unnecessary delay in handling policy claims, incompetent or incomplete investigation of claims, declining to make a reasonable settlement and failing to interpret the terms and language of an insurance policy in a manner deemed reasonable.
While every policyholder should carefully read their insurance policy, policies are often written in a convoluted fashion that is difficult to understand. This type of language makes it especially difficult for the layperson to determine whether their damages are covered or fall under an exclusion. A good lawyer can explain to you what your actual coverage and benefits are and assist you in finding coverage under terms of the policy that are often overlooked.
Unfortunately, most people only find out they’re not covered or covered inadequately after a significant loss has occurred. For instance, most people who have homeowners insurance policies believe that once a storm has occurred and many of their belongings are destroyed, that coverage and therefore payment, is automatic. This is just not the case. When larger losses occur many insurance companies will send out adjusters for the purposes of determining whether your damages are covered by your policy. Without having someone to properly represent your interests, you could find that many of these adjusters will overlook key aspects of your insurance policy, making it easy to be denied payments for which you are rightly entitled. Additionally, the majority of people who purchase homeowners insurance policies mistakenly believe they are covered for damages they are not, such as flooding. Perhaps a tree fell on your house, and though it might seem logical that this would be covered by your insurance company, your insurance company may deny the claim because the tree was on a property belonging to someone else. An experienced attorney can review your policy and assist you in obtaining the most cost effective insurance policy.
There are several reasons for insurance companies to deny, delay or contest claims, and they are experts at coming up with reasons why no coverage exists, no matter what type the policy is.
Austin R. Freundlich, Esquire and Gregory C. Littman, Esquire are attorneys experienced in handling insurance policy disputes. If you are having difficulty getting an insurance claim taken care of or feel your claim is being denied unfairly, contact us at (215) 545-8500 or info@FreundlichandLittman.com for a free case evaluation and consultation.