INSURANCE COMPANY BAD FAITH

What is "bad faith"?

Bad faith is a term used to describe an insurer’s wrongful conduct. The wrongful conduct may involve a number of issues such as:

• Lowballing;
• Unreasonable Delays;
• Stonewalling;
• Intimidation;
• Incomplete Investigations;
• Unfair leveraging; and,

Any Other Types of Insurer Misconduct.

What are "bad faith" damages?

Bad faith (also called “extra-contractual”) damages are above and beyond whatever is payable or due under the insurance contract.

How is "bad faith" determined?

1. Reasonable v. Unreasonable Claim Denials
In general, there is a distinction between a reasonable and an unreasonable claim denial. If an insurance company reasonably denies a claim, there is no bad faith. Rather, the claimant's primary remedy is based on breach of contract. In contrast, an unreasonable claim denial results in an action based on both contract and tort. The distinction is critical.

2. First Party v. Third Party Denials
If reasonably denied, the range of damages is limited to contractual damages that are reasonably foreseeable at the time the policy was issued. As such, in the absence of bad faith, a first party insured is entitled to the value of the property damaged up to the policy limits. In third party cases, the insured is entitled to any judgment as well as defense costs plus interest up to the policy limits.

3. Case-by-Case Determinations
A case-by-case evaluation is typically required to determine the existence of "bad faith". To that end, many issues are considered when evaluating an insurer’s conduct such as:

• Was the claim evaluation (and/or adjustment) based on an innocent mistake or intentional misconduct?
• If an innocent mistake was made in the claim evaluation (and/or adjustment), then did the insurance company admit the mistake and try to fix it?
• Did the insurance company and/or its representative(s) attempt to conceal relevant information about the claim?
• Was the insurance company given multiple opportunities to pay for the covered loss and correct the impropriety?
• Were the policy benefits explained?
• Did the insurance company disclose all insurance policies applicable to the claim?
• Did the insurance company knowingly delay payment?
• If there was a delay, then did the insurance company give a reason for the delay?
• Did the insurance company ask its policyholder(s) to give up any rights under the policy in exchange for benefits otherwise due?
• Did the insurance company ignore or knowingly fail to evaluate (and/or adjust) all or part of the claim?
• Did the insurer offer to pay a portion of the claim if the claimant/policyholder agreed to give up another part of the claim?
• Did the insurance company accuse the policyholder of fraud or lying without justification?
• If compelled to file suit, did the insurance company engage in "scorched earth" or "rambo" litigation tactics?
• Did the insurance company fail to defend a third party claim?
• Did the insurance company fail to pay an uninsured motorist claim, homeowner's claim, disability claim, third party liability claim, fire loss, life insurance benefits, medical benefits, or some other covered loss without a good faith basis?
• Did the insurance company conduct a prompt, thorough and objective investigation of the claim?

The Zaritsky Law Firm has the knowledge and experience to evaluate "bad faith" on a case-by-case basis and will vigorously challenge insurer misconduct.

4. Breach of the Implied Covenant of Good Faith and Fair Dealing
In Florida, the claimant may also bring an action for breach of the implied covenant of good faith and fair dealing, which is implied every insurance policy. If breached, the insured may seek a tort measure of damages that may include economic and business related losses arising from the denial of coverage. In addition, like bad faith, the claimant may recover attorney fees for obtaining the coverage that was unreasonably denied. Moreover, if the conduct was particularly wrongful, the court may authorize the policyholder to seek punitive damages.

Whether based on the implied covenant of good faith and fair dealing, unfair claims practices, or bad faith, the Zaritsky Law Group will vigorously challenge insurer misconduct. The Zaritsky Law Firm has the knowledge and experience to aggressively represent you and protect your rights.

What are the various contexts in which "bad faith" may arise?

Multiple types of insurance coverage may be subject to bad faith such as:

• Life Insurance
• Property Insurance
• Fire Insurance
• Flood Insurance
• Wind Insurance
• Hurricane Insurance
• Health Insurance
• Auto Insurance
• Disability Insurance

The Zaritsky Law Firm vigorously challenges insurer misconduct. We have the knowledge and experience to aggressively represent you and protect your rights.

Life Insurance and Disability Claims Denied


Many workers contribute to disability and life insurance directly from their paychecks. In turn, these individuals have the right to expect that, if needed, the insurance will provide for them in their time of need. Unfortunately, some life and disability insurance companies fail to pay valid claims. As a result, an experienced bad faith insurance attorney is necessary to provide peace of mind and restore their rights.

The Zaritsky Law Firm vigorously challenges insurer misconduct. We have the knowledge and experience to aggressively represent you and protect your rights.

Taking Insurance Companies to Trial


If an insurance company does not respond to our request for payment of the claim or unreasonably refuses to settle a claim dispute, our firm takes the next step - court. If warranted, the Zaritsky Law Group will argue your case in front of a judge and/or jury, whether in state or federal court, to ensure our clients receive their full compensation and to obtain justice.