Jim Adler | The Tough, Smart Lawyer
By Jim Adler October 31, 2015

When insurance companies deny, delay or underpay injury claims without a reasonable basis, they’ve acted in bad faith. In this instance, the insured person can file a bad faith claim against the insurer, suing for additional damages on top of the original injury claim.

What is Bad Faith?

Since the policy you purchased constituted a promise by the insurer to provide you with insurance protection, the insurer has a duty to provide such protection and to negotiate and settle your claim in good faith. If it fails to keep this promise, the insurance company has acted in bad faith.

Bad faith, in a legal sense, can be demonstrated in several ways.

For one thing, it must be shown that the insurance company failed to investigate thoroughly before denying a claim, or that it ignored or missed obvious elements which would validate the claim.

This can be due to simple negligence or it can be due to a willful, deliberate ploy to avoid paying the claim. The insurer’s making an innocent mistake may not be enough to establish a bad faith claim.

The insurer may have failed to respond to an injury claim within a reasonable time after receiving the claim. Or the insurer may have tried to settle a claim based on a policy which was changed without the insured person’s knowledge or consent.

The insurer also may have used demeaning, intrusive or harassing investigative measures when processing the claim, or it may have used fraudulent and illegal methods of investigating the claim.

Lastly, the insurance company may have demanded overly burdensome documentation of a claim — documentation which was not required by the policy but was insisted upon in order to delay or deny the claim.

Bad Faith Damages That are Recoverable

As for what damages are recoverable in a bad faith claim, the claimant can receive what the insurer should have paid for the initial claim, plus additional damages for the insurer acting in bad faith.

These extra bad faith damages include “consequential” damages occurring due to the bad faith denial, such as legal costs for a car accident injury lawsuit brought by the covered driver, and legal costs to sue the insurer in order to prove bad faith.

Claimants also may be able to recover damages for their emotional distress due to the claim’s denial. These are not quantifiable like court costs, but they are very real damages which can be assessed by a court.

Other potential recoverable damages for bad faith include punitive damages if it can be proven that the insurer recklessly or deliberately acted in bad faith to harm the insured person holding its policy. Punitive damages would not be awarded for mere sloppiness or innocent mistakes, but only for willful and harmful denial despite a clear basis for awarding the claim.

Texas Bad Faith Laws

Section 541.060 of the Texas Insurance Code specifies practices that would constitute an “unfair or deceptive act or practice.” These include:

• Failing within a reasonable time to affirm or deny coverage

• Misrepresenting a material fact or policy provision to a claimant

• Delaying or refusing a claim’s settlement only because there’s no other insurance than a Texas personal auto policy

• Failing to give a policyholder a reasonable explanation for denying a claim or failing to offer a compromise settlement.

If such failures are established in court, the insurer may be compelled to pay — along with actual damages — attorneys’ fees, court costs and “any other relief the court determines as proper.” Additionally, if it is established that the insurance company knowingly committed one or more of these violations, triple damages may be awarded.

Bad faith denial of claims, which is illegal, is punishable by substantial fines and punitive damages which can be many thousands of dollars.

How to File a Bad Faith Claim

As for how to file a bad faith claim, the claimant first should get the insurance company’s reasons for denying the claim in writing. Then the injured person should seek legal counsel to navigate the waters of filing a bad faith lawsuit against the insurer.

Keep in mind that insurance adjusters are trained to delay, deny or minimize claims, in order to save money for their employers: the insurance companies. It could be argued that insurance companies routinely act in bad faith. Even so, such bad faith must be demonstrated clearly by evidence in order to hold the insurer accountable.

If you believe you’ve been treated in bad faith by your insurance company, notify the injury attorneys at Jim Adler & Associates today. We’ll promptly provide you with a free legal consultation for your case.

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My lawyer Bill Adler and case manager Iris Sanchez are amazing! They constantly call and check on you . They keep you up to date through the process. They care about you as a person and not just a client. The wreck was a life changing experience that I've never been through before. I'm just glad I had the right people like Bill Adler and Iris Sanchez to help me through it. Truly satisfied.Thanks and God bless y'all!read more
Tierra Clark
Tierra Clark
18:52 19 May 17
I was dropped from a previous law firm regarding my case before I called Jim Adler. They immediately took up my case and worked hard on it - I was always up to date with each step they took and the benefits or consequences of each. In the end, I am highly satisfied with the outcome and would not have it any other way. It took some time but I truly appreciate and want to thank everybody who helped me on this journey and worked tirelessly on it.read more
Tori Barroga
Tori Barroga
14:17 11 May 17
I am a Patrol Deputy for the Sheriff Office and while working one night, a drunk driver crossed the center stripe on the highway and struck my patrol vehicle head on with his pick up truck. Needless to say we (the drunk driver and I) were both lucky to survive, as the accident occurred at highway speeds. Following my release from the hospital, I knew that I would need to have someone represent me. My employer was happy to represent me in regards to prosecuting the driver for criminal charges but, can do little in respect to the recovery of financial losses for medical bills, pain and discomfort, time lost from work etc... This is how my relationship with Jim Adler and Associates began. Yep, you probably guessed correctly when you think of what made me choose the "Texas Hammer" to represent me. Those half obnoxious, half way entertaining commercials and radio announcements most Texans have been seeing and hearing on the TV and radio for years instantly came to mind. Yes, I wanted to "hammer" this S.O.B. for trying to kill me but, more importantly I was worried about the costs associated with the life long injuries I had sustained as a result of this drunk driver's negligent behavior. I contacted Jim Adler and Associates and so began our relationship. I was immediately surprised by the prompt attention and the expression of genuine concern for my well being that I received from the employees of Jim Adler's office. Now as you can imagine, lawyers are not a breed that is held in very high regard by people in my profession but, my experiences with Jim Adler's office and his employees have forced me to amend my way of thinking, at least on the civil side of the house anyway. I have to chuckle when I say that because my experience as a client of Jim Adler's firm has been exceptionally pleasant. So before I venture down one of the stereotypical and infinite number of rabbit holes associated with the relationship between members of law enforcement and lawyers; I will do my best to stay focused on my experience with Jim Adler & Associates. Upon being informed that my case had been accepted by Jim Adler's office; I was contacted by Iris Sanchez who informed me that she was to be my case manager and any questions, comments and concerns could be directed to her. I was pleasantly surprised to receive regular calls from Iris assisting with my medical appointments and future follow up appointments. Iris had informed me that Jim Adler's son, Bill Adler would be handling my case and I was even more surprised to receive several calls from Bill to discuss my case. Now you might be thinking "what's the big deal" with the person who is representing you contacting you? In reality, you are correct in that it isn't a big deal but, what is noteworthy and what separates Jim Adler's Office from the multitude of other lawyers is the genuine expressions of concern and the desire Bill Adler conveyed to me to do their best to help me. I felt an immediate connection and instantly realized I had made the correct choice in contacting Jim Adler & Associates to handle my case. One thing I think lawyers and police officers can agree on is the proverbial wheels of justice turn very slowly. Months go by and our professional relationship is never neglected. Through the unwavering attention of Iris Sanchez and Bill Adler himself, I never felt "out of the loop" so to speak and always had a clear understanding of where my case was at in regards to the legal process. In conclusion, I know my brief description of my experiences with Bill Adler and, his assistant Iris Sanchez, cannot provide the credit they deserve. Together they have done an outstanding job representing their firm/employer. If you are seeking a great firm to represent your legal interests and, take comfort in establishing a professional relationship that feels more like a friendship than a casual business acquaintance, then I highly suggest Jim Adler & Associates.read more
Erick Becker
Erick Becker
01:20 06 May 17
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Bernard Orozco
Bernard Orozco
17:16 23 Feb 17
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Lorenzo Preston
Lorenzo Preston
17:23 26 Jan 17
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