Insurance

Business Interruption Claims After Hurricane Laura

| Read Time: 2 minutes

2020 presented multiple unprecedented challenges for all Americans. Hurricane Laura hit the residents of southwest Louisiana with fearsome strength, causing massive destruction. Thousands of businesses were destroyed and damaged by the severe winds and relentless flooding. If your business closed due to Hurricane Laura, contact the qualified attorneys at The BFH Law Group to discuss your options and review your business interruption claims after a hurricane.   What Does a Business Interruption Policy Cover? A business interruption policy provides financial assistance to businesses forced to close down due to an event covered by their policy, which impacted their business property. If your business suffers a loss covered by your business interruption policy you can file a claim for:  Revenue the company would have earned if it were operating normally; Mortgage, rent, and lease payments for your business property; Loan payments made during the time where your business is nonoperational; Taxes;  Payroll for employees; and Relocation costs if you were forced to move to a new location as a result of damage to your business property.  Determining what your business interruption insurance covers require a detailed review of your policy terms and conditions. The attorneys at The BFH Law Group can review your business interruption claims after a storm to determine the details of your coverage.  How Do I File a Business Interruption Claim? After a natural disaster such as a hurricane, contact your insurer immediately to advise them that your business property was damaged, causing your business to cease operations.  The way you present your business interruption claim after a hurricane is critical to receiving an appropriate response to your specific needs. Business interruption claims should include the following: A cover letter providing details of your business, including location, details of the damage suffered, your business’s current operation status, and the impact to your business; Detailed calculations of losses suffered; and Supporting documentation of how you arrived at your estimates.  Insurance companies deal with thousands of claims. Therefore, it’s crucial to provide as much specific information about your business and the damage suffered as possible. Providing all the relevant information necessary allows the insurer to more quickly process your claim.  What Are Probably the Most Common Causes of Business Interruption?  Your business may suffer an event causing interruption to your business at any time.The most common causes of business interruption include the following:  Fire and explosions, Natural disasters, Supplier failure, Cyber incidents, and Machinery breakdown. Almost all businesses face some degree of risk with the above events. Determining the degree of risk to your company of suffering any of the above events can help you decide what type of business interruption coverage to purchase.  Talk to an Attorney About Your Business Interruption Claim If your business closed after Hurricane Laura, contact The BFH Law Group to review your business interruption claims after a storm. Our firm provides free information and resources so you can better understand the process of business interruption insurance. Our attorneys assist businesses in all stages of business interruption claims, from making the claim to litigating disputes with the insurer. If your business interruption claim has been delayed, denied, or underpaid, contact us today for a free claim review!

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Insurance

Do I Need an Attorney for My Lake Charles Homeowners Insurance Claim?

| Read Time: 3 minutes

When a hurricane damages a roof, it is considered an act of God or a force of nature. As a result, the homeowner’s insurance usually covers the damage. The claim does not process automatically. Nor is there an automatic appeal if the insurance company denies your claim. Be proactive in both stages by filing an insurance claim accurately and getting legal representation if the claim is denied or ignored. Hurricane Laura, like the hurricanes before it, caused significant damage in Lake Charles. Roof and interior water damage was particularly prevalent. Unfortunately, many homeowners found their roof insurance claim denied or severely underpaid. Many other homeowners had much of the water and wind damage to their property completely ignored. If your insurance company is being unresponsive, has undervalued your claim, or has denied your claim, it’s important to seek the help of an experienced insurance lawyer. Phase One: Handling Your Claim If you have hurricane damage to a Lake Charles home, you likely contacted your insurance agency and filed a claim (and if you have not, do so as soon as possible). Try to create a record or log of all calls and communication with the agency, including dates, names, and reasons for contact. Add your insurance policy and claim information to this file. Also include pictures and videos related to the hurricane damage to your home (including roof damage, if you can do so safely). You should also compile pictures of your home from prior to the storm to support your claim in the event it is denied. Neighbors, relatives, and even your children may have pictures you can use. In this age of social media, videos and photos are more accessible and come from various sources. You may not be able to gather everything suggested. That is okay. Gather what you can and start now; make it a point to record things consistently in case you find your roof insurance claim denied. Phase Two: Contacting an Attorney If Your Claim Is Denied, Delayed, or Underpaid  You should have an attorney for your Lake Charles homeowners insurance claim. If the insurance company denies, delays, or underpays your claim, there are substantial ramifications. It can delay a safe return to your home and cause pain and suffering financially and emotionally. Therefore, hire an accomplished homeowners insurance attorney if the insurance company: Did not reply to your claim in a reasonable time; Did not pay enough to repair your home to its prior condition; Denied your claim in full or in part; or Did not apply the maximum coverage amount your policy allows in the circumstance. Your attorney can follow up on your claim’s status. They will demand action or appeal a denial through the agency’s internal process. Skilled in negotiating, they can seek a settlement to your claim quickly. A homeowners insurance litigation lawyer knows the state and federal regulations and laws that govern insurance agencies. When warranted, they can take legal action on your behalf. Having an attorney address your Lake Charles homeowners insurance claim can be as essential as having insurance and filing a claim after a natural disaster.  No matter how thoroughly you present it, you may find your homeowner’s insurance claim denied. The outcome of filing a claim or fighting a denial is never guaranteed. But you will have the best chance of a fair resolution to your insurance claim with a strong attorney helping you. The BFH Law Group: Experienced Lawyers Offering Free Consultations 24/7 The BFH Law Group has offices in multiple states, including Louisiana, Texas, Florida, and Georgia. Representing homeowners in insurance disputes is one of our main focuses, and we have helped our clients recover millions of dollars in insurance claims. When you need an attorney for your Lake Charles and Southwest Louisiana homeowners insurance claim, we are here for you. For a free consultation, please contact us online or by phone.

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Insurance

Why Did My Insurance Deny My Claim After Hurricane Laura?

| Read Time: 3 minutes

For insurance and legal purposes, hurricanes are not accidents. They are dangerous wind and water events that can cause massive damages. On Thursday, August 27, 2020, Hurricane Laura made landfall and caused $14 billion in damages near southwestern Louisiana and southeastern Texas near the Gulf of Mexico.  If the hurricane damaged your property, your insurance company must address your claim fairly and in a reasonable time. But if an insurance company unfairly denies all or part of your claim, you may have recourse. Take legal action today if you find your homeowner insurance claim denied or you anticipate being in an insurance dispute. What Are the Responsibilities of the Insurance Companies? After you file your insurance claim and work with the company’s adjuster to file the information necessary to support the claim, the ball is in their court. The law requires that the insurance company:  Repair the damage to a pre-loss condition (or provide total loss payments); and Pay your claim within 30 days of receipt of proof of loss. Regardless of the degree of damage or number of other claims they are dealing with, it is the insurance company’s job to address your claim. In doing so, they must act in good faith. Finding your homeowner insurance claim denied without cause should lead you to seek legal help. Why Might the Insurance Company Deny My Claim? Unfortunately, during the challenging period of rebuilding after a hurricane, sometimes insurance companies deny claims wholly or partially. Some reasons insurance companies initially deny claims are because of: A mistake made by the claims processing agent; A mistake made by the cat adjuster; Missing information to support the claim; The insurance company questions the cause of the damage; The insurance company misinterprets the policy;  The damage is not covered by your policy; Policy issues exists (lapsed coverage or deductible issues); or The insurance company is acting in bad faith. When the insurance company does not handle your claim to your satisfaction, it adds immense stress during an already trying time. However, there are ways to fight an unjust decision with the help of an attorney. How Can a Lawyer Help Me With an Insurance Claim? Reputable insurance litigation attorneys have the training needed to help claim holders in insurance disputes. Because of their skills and training, your insurance attorney can: Work toward getting you the amount you are entitled to receive for your claim(s) under the terms of your policy; Ensure your property damage is evaluated by qualified experts;  Seek additional damages if the insurance company failed to pay timely or acted in bad faith; and Use their skills to negotiate with your insurance company or take them to court. Contact an insurance litigation lawyer for help immediately if: You believe your policy provides more coverage than you received payment for;  You believe the insurance company did not pay your claim within 30 days of receipt of evidence of your damages; or You discover your homeowner insurance claim denied. Your best chance of fighting a claim issue is with the help of a lawyer. They should always be open and honest with you and never promise a specific recovery amount. Be sure to work with an attorney specializing in insurance claims. We are all grateful to have survived hurricane Laura, tied as the fifth-strongest hurricane on record to make a continental U.S. landfall. Nevertheless, you have a right to advocate for the recovery you deserve from your insurance company. You paid for your policy. Seek legal help, and be sure the insurance company addresses your claim fairly and thoroughly. The BFH Law Group, Ready to Fight for You Our firm has offices in New Orleans, Houston, and Lake Charles. Our practice focuses on insurance cases (life/health insurance, hail/fire damage, hurricane damage), and we have recovered millions of dollars for our clients in insurance disputes. At The BFH Law Group, we pride ourselves on being highly skilled attorneys with exceptional insurance litigation knowledge who are friendly and approachable with our clients. Contact us today for a free consultation.

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Insurance

Secrets About State Farm Car Accident Claims

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One of the leading injuries, if not the leading injury of car accident victims, is whiplash. In fact, whiplash injuries affect more than one million people in the United States every year. To make matters worse, whiplash victims must also frequently deal with insurance companies like State Farm after their accident. If you have sustained whiplash injuries in a car accident, you might have questions such as: How long does it take State Farm to settle a claim?  What is my potential State Farm settlement for whiplash?  Will State Farm help me maximize my settlement? The purpose of insurance is to help provide compensation in the event of an accident. However, there are a number of things insurers don’t want you do know. So let’s dive in and discuss the three secrets about State Farm car accident settlements that you’ll want to know to help you maximize your State Farm settlement for whiplash. Secrets of State Farm Car Accident Settlements State Farm claims that its goal is to help injured victims recover. However, State Farm’s ultimate goal is to collect the maximum amount of premiums while paying the minimum number of claims. Thus, it is important to know how State Farm operates so that you can effectively get the compensation you are entitled to recover.  Secret 1: State Farm May Attempt to Use Your Past Against You State Farm will dig into an individual’s past to find information that could justify reducing or denying a claim. For example, consider a car accident victim who is involved in a rear-end collision and sustains serious whiplash. If the victim sustained a similar injury in the past that may have contributed to their symptoms, the State Farm settlement for the whiplash injury might be reduced. State Farm will often use this tactic to reduce an injury victim’s potential recovery. Therefore, it is important to be careful with what medical records you provide to State Farm. Every request for medical records made by State Farm should be reviewed by an attorney. In fact, it is prudent to engage an attorney to assist with the entire process. Secret 2: You Do Not Have to Accept State Farm’s Offer to Settle The issues following a car accident can range from physical to emotional to economic. Financial pressures are bound to present a hardship for most injury victims. Unfortunately, State Farm is aware of these financial burdens on victims and will often use them to its advantage. However, know that you do not have to accept any offer made by State Farm, let alone their very first offer. While any amount up front may seem appealing, you very well may be entitled to even more. An attorney can help you review your offer and determine whether it is a fair representation of the compensation you will need to recover.  Secret 3: Don’t Feel Pressured to Provide State Farm with a Statement State Farm adjusters will try to pressure you to make a recorded statement. However, despite their insistence, you do not have to provide one.  Regardless of whether you are navigating a State Farm rear-end collision settlement, whiplash settlement, or any other car accident settlement, don’t feel pressured by State Farm. If the adjuster has questions about the accident or injuries sustained, there are other avenues available to them.  If you don’t feel comfortable communicating with State Farm on your own, contact an attorney to help you communicate and negotiate your claims on your behalf. Not only will this relieve some pressure from your shoulders, but it may also allow you to maximize your ultimate recovery.  Contact Our Team Today Experienced attorneys are able to recognize when State Farm uses these “tricks” to offer a lower settlement. The attorneys at BFH Law Group have six decades of combined experience helping clients in the most difficult times of their lives. Further, we know State Farm’s secrets and will fight to help you get the compensation you need to recover. Contact our team today to discuss your case and see how we can help you with your State Farm settlement for whiplash. 

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Insurance

New Orleans Insurance Disputes: Should You Hire an Attorney?

| Read Time: 3 minutes

When you experience an accident or property damage in New Orleans, you expect your insurance company to help. After all, you pay premiums every month so that you have coverage in an emergency. However, insurance companies don’t always come through on their end of the bargain. What should you do if your insurance refuses to pay your claim? Some people give in to the pressure of insurance company intimidation and simply take the financial loss. Other people want to fight the insurance company to recover the compensation they deserve. If you want to dispute an insurance claim denial, you need an experienced New Orleans insurance attorney on your side. Our skilled insurance attorneys at the BFH Law Group will challenge unfair insurance denials and negotiate for your maximum compensation. Call our New Orleans insurance dispute lawyers for a free consultation. Keep reading to learn more about disputing an insurance claim. How an Insurance Attorney Can Help Our experienced insurance attorneys spent the early days of our careers working for businesses and insurance companies. This experience with insurance company disputes gives us insight into how insurance companies work, including strategies they use to deny claims. We counter these unfair tactics with legal advocacy that attempts to get you a maximum insurance settlement. Our law firm employs talented investigators who will uncover all possible evidence. We use this evidence to support your insurance claim dispute. Since your insurance company must maintain a duty of “good faith and fair dealing,” we point out where they are acting unfairly. Then our New Orleans insurance attorneys negotiate with the insurance company for your maximum compensation.  What Documents to Bring to Your Attorney When you meet with one of our New Orleans insurance attorneys for a free consultation, bring any evidence to dispute your insurance claim denial. To prove that your insurance claim is valid, you should bring the following relevant documents: Your insurance policy, Photos of the damage, Medical bills, Pay stubs, Property repair invoices, Emails or text messages from your insurance company, Letters from your insurance company, Notes from phone conversations with your insurance company, Police reports, and Names and contact information for witnesses. If you don’t have some of these relevant documents, our experienced investigators can attempt to access them. Our law firm will collect all essential information to dispute your insurance claim denial and argue for your maximum payment. What Information to Provide to the Attorney Along with documentation, you should give your insurance attorney a statement describing your experience. Your attorney needs as much fact-specific information as possible. Keeping in mind the “W” questions of journalism can guide you to a complete description of events: When did the incident occur? Where did the accident happen? What caused the incident? Who witnessed the accident? What damage resulted from the incident? Why did the insurance company deny your claim?  It’s best to speak to an insurance attorney before you give a statement to the insurance company. You may feel overwhelmed after an accident or property damage experience, so it can be difficult to provide a complete account of your experience. An attorney can help you think of all the relevant information before you speak to the insurance company. Get Help from a New Orleans Insurance Attorney If you experienced an insurance claim denial, you need an insurance attorney. At the BFH Law Group, our experienced insurance attorneys help clients who have had insurance claims unfairly denied. We will collect all the relevant information to support your claim and challenge the insurance company to pay you what they owe. Contact us today for a free consultation. We will review the details of your claim and let you know if we can help. If we take your case, we work on contingency, meaning you owe us no payment until we win your claim. Call us today to start your challenge to an unfair insurance claim denial.

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Insurance

Third-Party Bad Faith Claim

| Read Time: 3 minutes

If you are injured by the negligence of another person, their insurance company is usually responsible to pay for your injuries. However, sometimes an insurance company refuses to settle for a reasonable amount, even when their liability is clear. If this happens to you, an experienced personal injury attorney can help you pursue a third-party bad faith claim against the insurance company. What Is a Stowers Demand? Many third-party bad faith claims are governed by the Stowers doctrine in Texas. The Stowers doctrine applies when you suffer damages that exceed the defendant’s insurance policy limits. Stowers Demand Letter To comply with the Stowers doctrine in Texas, your attorney would start by sending a Stowers demand letter to the insurance company. The letter must: Include a demand for compensation within the policy limits; State clear terms for accepting the demand; Provide a reasonable amount of time for the insurance company to respond;  Demonstrate that any subrogation claims and hospital liens have either been settled or will be resolved with the proceeds from the settlement; and Offer to fully release the defendant from further liability. If the insurance company rejects your Stowers demand, your next step is to go to court. Pursuing a Bad Faith Claim If you win a jury verdict for greater than the policy limit, then you may be able to make the insurance company pay the extra damages by bringing a third-party bad faith claim. The defendant is the one who would usually be on the hook for damages in excess of the policy limit. So technically, the defendant is the one who would have a bad-faith claim against their insurance company. But you can get a court to issue a turn-over order. This requires the defendant to give you their cause of action so you can actively collect against the insurer.  To succeed on a bad faith claim, you must demonstrate that: Your Stowers demand letter complied with the requirements above; Liability for the amount of the policy limit or more was reasonably clear; and You actually won a verdict in court for more than the policy limit. The most difficult element to prove is that liability was reasonably clear. If there was a fair dispute about whether the defendant was negligent, whether your negligence contributed to the accident, or the amount of damages, then it is not bad faith for the insurer to reject a Stowers demand, even if you later win. Why Would I Want to Settle for the Policy Limit If My Damages Are Greater? Even if your damages are significantly greater than the policy limits, it often makes sense to accept a settlement for the amount of the policy limit. The reality is that nothing requires an insurance company to indemnify a defendant for any more than the policy limits. And most defendants simply don’t have the assets to pay off large verdicts. This means that even if you go to court and get a verdict for an amount above the policy limits, you could struggle for years to ever recover that money. The defendant also has a motivation to settle within the policy limits. Doing so helps them avoid the risk of having a personal judgment against them. Such a judgment can lead to wage garnishment and liens on their assets that can follow them for years. This is why an insurer must accept a Stowers demand where liability is reasonably clear. With a Stowers demand, you can reach a settlement with the insurance company that gets you your money right away. You won’t have to spend years of uncertainty waiting for a jury verdict while struggling to pay your bills. How Do I Know If I Can Pursue a Third-Party Bad Faith Claim? If you suffered injury in an accident caused by someone else, contact our personal injury attorneys at the BFH Law Group. We can help you determine whether a Stowers demand might be the way to go and handle every aspect of your personal injury claim. Our decades of experience working both for and against big insurance companies put us in a strong position to negotiate on your behalf. Call or contact us today to learn how we can help you get the compensation you deserve.

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Attorney Portrait Insurance

How to Deal with an Insurance Adjuster After a House Fire

| Read Time: 2 minutes

A house fire can be a devastating experience for a homeowner, and dealing with an insurance adjuster in the aftermath can only make matters worse. Though it can be a complicated process, you don’t have to go through it on your own.  If you or a loved one has been affected by a house fire, know you are not alone. Even if an insurance company has denied your claim, this is not necessarily the end of the road. The fire damage lawyers at the BFH Law Group have the knowledge and experience necessary to fight back against your insurer. Read on to learn more about the fire insurance claim process and find out how we can help. How to Handle the Fire Insurance Claims Process The insurance claims process can be difficult to navigate, especially when it involves fire damage to your home. However, there are some things you can do to help maximize your insurance claim proceeds. Below are a few important things to keep in mind during the insurance claims process: File Your Claim as Soon as Possible It is crucial to comply with your policy and file your claim within the appropriate timeframe. Otherwise, you may forfeit your right to recover damages at all.  Request an Advance In some scenarios, you can get an advance payment against your claim. If you were forced to evacuate after the fire, this advance can help pay for basic necessities that you were unable to grab before relocating. Secure Your Property and Mitigate Damages Insurance policies require that you “mitigate damages.” In short, this means that you must take reasonable steps to minimize further harm to your property. This includes taking action to protect it from the elements, vandalism, and looters. Keep Track of Your Expenses Your policy may provide reimbursement for living expenses if you have to relocate after a fire. Thus, it is important to keep a careful record of all receipts, bills, and expenses. Don’t Feel Rushed Your insurance company will probably want you to close your claim as quickly as possible. However, don’t feel pressured to do so before you are ready. If you have received an offer for payment that you feel is not enough, contact a lawyer who can evaluate your case before moving forward. How the BFH Law Group Can Help with Your Fire Damage Claim The BFH Law Group has what it takes to assist with your fire damage claim. Our knowledge of this area of the law allows us to help assess and calculate damages, advocate for you against the insurance companies, and work toward a speedy resolution of your claim.   Our team of lawyers has extensive experience handling these types of claims, and we want to help. If your insurer has wrongfully denied your claim or failed to adequately compensate you for your damages, contact the BFH Law Group today. 

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Attorney Portrait Insurance

How Long Does an Insurance Company Have to Pay a Claim in Texas?

| Read Time: 2 minutes

Are you waiting to hear back regarding an insurance claim you filed in Texas? If so, you might be wondering what you need to do next. The lawyers at the BFH Law Group understand that this can be a complicated process to navigate on your own. Read on to find out more about the insurance claims settlement process in Texas and how we can help. Does an Insurance Company Have to Respond to My Claim?  In short, yes. Under Texas law, an insurance company is required to respond to a claim that is filed. Section 542.055 of the Texas Statutes provides that an insurer must do the following within 15 days of receiving notice of a claim from a claimant:  Acknowledge receipt of the claim; Commence an investigation into the claim; and  Request relevant information, statements, and forms from the claimant to assist with the investigation of the claim. An insurer’s failure to acknowledge that they have received your claim is in violation of the statute. However, the statutory requirements don’t end there. An insurer must also notify you of whether or not your claim has been accepted. In most scenarios, section 542.056 of the Texas Statutes states that an insurer must notify a claimant of acceptance or rejection of a claim within 15 days after the insurer receives all items, statements, and forms required to investigate the claim. An insurer can sometimes extend this to 45 days, but they must have a sufficient basis for doing so. Also, if the insurer rejects your claim, they must also provide you with the reasons for the rejection.  It is important to know your rights. If an insurance company has rejected your claim without a good reason, or they have failed to respond within the appropriate timeframe, you may need to take action. An experienced lawyer can help advocate on your behalf. Can I Speed Up the Process?  You cannot shorten the statutory timeframe that insurance companies have to work with. However, there are still things you can do to speed up the claims process. Because an insurer generally has 15 days to investigate the claim from the date they receive the requested information from you, sending these items as quickly as possible is to your advantage.  After an accident, try to compile as much information as possible to provide to the insurance company. Having witness statements, accident reports, and proof of loss forms completed and ready can help speed up the process.  When Does the Insurance Company Have to Pay the Claim? If an insurer notifies you that they will pay a claim or part of a claim, they must do so within a specific amount of time. Under Texas law, they cannot continue to delay payment. Section 542.057 of the Texas Statutes states that an insurer must generally pay the accepted claim “no later than the fifth business day after the date notice is made.” In fact, if an insurer fails to do so, you may be entitled to damages.  How a Lawyer Can Help If you are dealing with an insurance company that has delayed responding to or paying your claim, you might feel like there is nothing you can do. However, this is not the case. Know that you have rights, and there are actions that you can take. Don’t let an insurance company continue to delay your claims process. A lawyer can help protect your rights and fight on your behalf. Contact the team at the BFH Law Group today for a free consultation to see how we can help you.

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Insurance

Texas Insurance Code 541 and 542

| Read Time: 3 minutes

In Texas, insurance companies owe a wide range of duties to their policyholders aimed at ensuring claims are promptly adjusted and settled in a fair manner. An insurance company that breaches these duties can be liable to the policyholder for additional damages, penalties, and attorney’s fees. The reason insurance companies are so closely regulated is the inherent advantage they have over their insureds who are depending on coverage from the insurance company that they paid premiums for.  In Texas, there are two separate bodies of law that penalize insurance companies for acting in bad faith. The first is a common law implied covenant of good faith that requires an insurance company to treat you honestly and fairly. In addition, Chapter 541 of the Texas Insurance Code lays out in detail when an insurer engages in an unfair method of competition and unfair or deceptive acts or practices. In addition, Chapter 542 details an insurer’s duties to pay claims in a timely manner. If you believe your insurance company acted in bad faith, you should contact a Texas insurance attorney as soon as possible. Proving a Bad Faith Claim in Texas When proving a bad faith claim in Texas, it is important to understand that you have the burden of proof. This means that you, with the help of your lawyer, must demonstrate how the facts of your case meet the requirements of a bad faith claim. There are two ways that you can prove your bad faith claim: either as a common law bad faith claim or a statutory bad faith claim. Common-Law Bad Faith Claim To prove a common law bad faith claim, you must show that your insurance company denied or delayed your claim even though liability was reasonably clear. The Texas Supreme Court recognized a common law claim for bad faith in 1983. English v. Fischer, 660 S.W.2d 521 (Tex. 1983). Since then, the Texas Supreme Court has upheld the common law claim for bad faith despite the passage of statutes prohibiting insurers from engaging in certain actions that give rise to specific penalties.  Statutory Bad Faith Claim To prove a statutory bad faith claim, you must prove that your insurance company violated Texas insurance code 541 or 542.  Causes of Action You Can Bring Under Chapters 541  There are several different causes of action you can bring against your insurance company under Chapter 541 of the Texas Insurance Code. These claims can be brought against both your insurance company and insurance professionals, such as adjusters.  Misrepresentation of a material fact or policy provision; Failing to reach a settlement in good faith when liability is reasonably clear; Failing to reasonably explain why a claim was denied; Failing to affirm or deny coverage within a reasonable time; and Refusing to pay a claim without conducting a reasonable investigation. A Texas insurance lawyer can help you determine which of these causes of action is best suited to your case. First-Party Bad Faith Claims It is important to understand the type of bad faith claim that applies to your case. A Texas insurance attorney can help you figure out which type of claim you should file. First-Party Bad Faith Claim A first-party bad faith claim arises when you file a claim against your own insurance company after an accident or event. For example, you have a house fire and file a claim with your insurance company for the damage to your dwelling and personal property. If your insurance company fails to settle your claim when it is clearly liable under the terms of the policy, you can file a first-party bad faith claim against your insurance company. Damages There are two major types of damages available in bad faith suits against an insurance company. These include actual damages and attorney fees and court costs. Actual damages refer to the financial harm you suffered as a result of your insurance company acting in bad faith. It is also important to note that you can recover three times your actual damages if you can prove your insurance company knowingly violated chapter 541 of the Texas insurance code. A Texas insurance attorney can help you determine the amount of damages you could recover. What Should You Do If You Believe Your Insurance Company Has Acted in Bad Faith? If you believe your insurance company has acted in bad faith, you should contact a Texas insurance lawyer today. We at The BFH Law Group will determine the appropriate avenue to prove your bad faith claim. We will fight your insurance company and strive to get you the compensation you deserve. Contact us today to schedule your free consultation.

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Attorney Portrait Insurance

Bad Faith Insurance in Texas: Know Your Rights

| Read Time: 5 minutes

In Texas, insurance companies owe a wide range of duties to their policyholders aimed at ensuring claims are promptly adjusted and settled in a fair manner. An insurance company that breaches these duties can be liable to the policyholder for additional damages, penalties, and attorney’s fees beyond what is owed under the insurance policy. The reason insurance companies are so closely regulated is the inherent advantage they have over their insureds who are depending on the coverage they paid for.  In Texas, there are two separate bodies of law that penalize insurance companies for acting in bad faith. The first is a common law implied covenant of good faith that requires an insurance company treat you honestly and fairly. In addition, Chapter 541 of the Texas Insurance Code lays out in detail when an insurer engages in an unfair method of competition and unfair or deceptive acts or practices. Somewhat related is Chapter 542 of the Texas Insurance Code, which provides deadlines for an insurer to pay and settle claims. If you believe your insurance company acted in bad faith, you should contact a Texas insurance attorney as soon as possible. Proving a Bad Faith Claim in Texas When proving a bad faith claim in Texas, it is important to understand that you have the burden of proof. This means that you, with the help of your lawyer, must demonstrate how the facts of your case meet the requirements of a bad faith claim.  There are two ways that you can prove your bad faith claim: either as a common law bad faith claim or a statutory bad faith claim. Common-Law Bad Faith Claim To prove a common law bad faith claim, you must show that your insurance company denied or delayed your claim even though liability was reasonably clear. The Texas Supreme Court recognized a common law claim for bad faith in 1983. English v. Fischer, 660 S.W.2d 521 (Tex. 1983). Since then, the Texas Supreme Court has upheld the common law claim for bad faith despite the passage of statutes prohibiting insurers from engaging in certain actions that give rise to specific penalties.  Statutory Bad Faith Claim Under Chapter 541 There are several different causes of action you can bring against your insurance company under Chapter 541 of the Texas Insurance Code. These claims include:   Misrepresentation of a material fact or policy provision; Failing to reach a settlement in good faith when liability is reasonably clear; Failing to reasonably explain why a claim was denied; Failing to affirm or deny coverage within a reasonable time; and Refusing to pay a claim without conducting a reasonable investigation. Insurance companies, adjusters, and other personnel can be sued and held liable for bad faith insurance claim handling. There are numerous business practices that insurance companies may engage in that fall under the umbrella of bad faith. For example:  Undervaluing claims Delaying adjustment of claims Delaying payment of claims Misrepresenting terms of the insurance policy Pressuring a policyholder not to hire an attorney Ignoring portions of the claim during investigation and adjustment Canceling or changing the terms of insurance after making a claim Failure to communicate with the policyholder Not providing reasons for the insurance company’s determinations Failing to assign qualified personnel to adjust and investigate your claim Request unnecessary information to delay the claim adjustment process Alleging the insured engaged in fraud or criminal behavior without reasonable justification Bad faith normally requires you to prove that the insurance company didn’t just make an error, but that it engaged in intentional or grossly negligent conduct aimed at harming its insured. I often like to classify bad faith claims as either being obvious or not so obvious. An example of an obvious bad faith claim is where the insurance company knowingly makes misrepresentations to a policyholder. For example, the insurance company denies your insurance claim after being told by its own experts that the claim is covered by your policy. Another example of obvious bad faith may be an insurance company that misrepresents the terms of your insurance policy or changes the terms of the insurance policy without your knowledge.  Not so obvious bad faith often deals with the valuation of your claim. In many cases, an insurance company will estimate the value of your claim on the lower end. Although frustrating, this itself may not be bad faith. You need to compare the insurance company’s investigation and reports to what you are claiming. If your dispute with the insurance company is over the value of specific items that you are claiming, there may not be bad faith if the insurance company can prove that its valuation was reasonable. However, if the insurance company has ignored portions of your claim or estimated your damage in ways that are unreasonable, you may have a good claim for bad faith.  Damages for Bad Faith Conduct and Unfair Trade Practices If you establish bad faith, the following damages can be recovered:  Treble Damages, i.e. three times the amount the insurance company should have paid you. To get treble damages, courts tend to require that you prove the insurance company intentionally or knowingly acted in bad faith.  Attorney’s fees, interest, and court costs.  Interest on the delayed payments. Don’t Forget About the Prompt Payment Statute Chapter 542 of the Texas Insurance Code creates a number of requirements for insurers to respond to, investigate, and pay insurance claims. These requirements are separate and apart from the bad faith practices prohibited under Chapter 541. If an insurer violates this law, you are entitled to recover attorney’s fees and damages in the form of an annual 18% penalty.  To collect these damages, the law requires: (1) the policyholder had a claim under the policy; (2) the insurer is liable for the claim; and (3) the insurer failed to comply with a requirement of the statute.”  There are a number of specific requirements that you need to meet to collect attorney’s fees and damages for breach of the prompt payment...

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