Best Bad Faith Insurance Lawyers in Pennsylvania

About Bad Faith Insurance Law in Pennsylvania, United States

Bad faith insurance law in Pennsylvania addresses situations where an insurance company acts unfairly or in "bad faith" toward its policyholders. This area of law is designed to protect consumers and businesses who pay for insurance policies with the legitimate expectation that claims will be handled promptly and fairly. When an insurance company wrongfully denies a claim, delays payment, or fails to properly investigate a claim, it may be acting in bad faith. Pennsylvania recognizes bad faith claims both under common law and through specific statutes that allow policyholders to seek additional remedies.

Why You May Need a Lawyer

Insurance policies can be complex, and insurance companies have experienced legal teams on their side. You may need a lawyer in a variety of scenarios, such as:

• If your insurance claim is denied without a reasonable explanation.
• If the insurer unnecessarily delays a legitimate claim payment.
• If the insurance company fails to thoroughly or fairly investigate your claim.
• If the insurer offers a settlement that seems unreasonably low compared to your losses.
• If you feel intimidated or pressured to accept an unfair settlement.
• If you receive confusing or conflicting information from your insurer.
• If your insurance company accuses you of fraud without clear evidence.

Local Laws Overview

In Pennsylvania, the legal framework for bad faith insurance claims is primarily found in statute 42 Pa. C.S.A. section 8371. This law permits an insured person to take civil action when an insurer's actions are deemed to be in bad faith regarding any claim. Key aspects of Pennsylvania bad faith insurance law include:

• An insurer may be liable for interest on the claim amount, punitive damages, and the policyholder's attorney fees if found to have acted in bad faith.
• The law applies to all types of insurance except workers’ compensation and health insurance policies governed by the Pennsylvania Health Insurance Portability Act.
• Bad faith can include lack of proper investigation, unreasonable denial of benefits, or unfair settlement practices.
• To prove bad faith, the insured must show by clear and convincing evidence that the insurer did not have a reasonable basis for denying benefits and either knew or recklessly disregarded its lack of a reasonable basis.

Frequently Asked Questions

What is bad faith insurance?

Bad faith insurance refers to an insurer’s intentional or reckless failure to meet its contractual obligations to policyholders, such as by unjustifiably denying or delaying a legitimate claim.

How do I know if my insurance company acted in bad faith?

Signs may include unexplained claim denials, unreasonable delays, inadequate investigation, low settlement offers, or a lack of communication from the insurer. Consulting with a lawyer can help assess whether you have a potential bad faith claim.

What compensation can I receive if I win a bad faith insurance case in Pennsylvania?

You may be entitled to the value of the original claim, interest, attorney fees, and potentially punitive damages if the court finds the insurance company acted egregiously.

How long do I have to file a bad faith claim in Pennsylvania?

Generally, the statute of limitations for a bad faith claim in Pennsylvania is two years from the time you know or should have known about the insurer’s bad faith conduct.

Does bad faith law in Pennsylvania apply to all types of insurance?

Most insurance policies are covered, but there are exceptions, such as certain health insurance and workers’ compensation policies.

What evidence do I need to prove bad faith?

Evidence may include correspondence with the insurer, claim documentation, expert reports, and records that show unreasonable delay, denial, or insufficient investigation by the insurer.

Can I resolve my bad faith claim without going to court?

In some cases, insurance disputes can be settled through negotiation, mediation, or arbitration. However, litigation may be necessary if the insurer refuses to resolve the matter fairly.

Do I need a lawyer to file a bad faith insurance claim?

While not legally required, having a lawyer greatly increases your chances of successfully proving bad faith and maximizing your compensation.

What is the difference between a simple claim denial and bad faith?

A claim can be denied for a legitimate reason based on policy terms or exclusion. Bad faith involves denial or delay without a reasonable basis, or failure to conduct a fair investigation.

Will filing a bad faith lawsuit affect my insurance coverage?

You cannot be lawfully dropped or retaliated against solely for asserting your legal rights, but it is wise to consult with an attorney about potential impacts.

Additional Resources

If you believe you have been a victim of bad faith insurance practices in Pennsylvania, these resources may be helpful:

• Pennsylvania Insurance Department - Handles consumer complaints and provides information on insurance rights.
• Pennsylvania Bar Association - Can help locate legal assistance in your area.
• National Association of Insurance Commissioners - Offers consumer guides and complaint tools.
• Local consumer protection offices - Provide assistance in filing and resolving complaints.
• Nonprofit legal aid organizations - Offer support for low-income individuals facing insurance disputes.

Next Steps

If you suspect your insurance company has acted in bad faith, take these immediate steps:

• Gather and organize all communications and documents related to your insurance claim.
• Keep detailed notes of your interactions with the insurance company.
• Consider submitting a formal written complaint to the insurer and the Pennsylvania Insurance Department.
• Consult with an experienced Pennsylvania bad faith insurance attorney as soon as possible to review your case and discuss your options.