Responsible families all across Alabama pay monthly insurance premiums in order to protect their families from liability. One serious car accident or house fire has the potential to bankruptcy a middle-class family when an insurance company fails to pay the claim. We depend on Alabama insurance companies to adequately settle legitimate claims. What happens when insurance companies refuse to pay for auto accident claims that are covered by the policy?
Under Alabama law, auto insurance companies must act reasonably when they investigate, process, and pay insurance claims. When insurance companies act in bad faith, they may be in violation of Alabama state law. Alabama recognizes the personal injury tort of insurance bad faith. You, as a policyholder, have a right to bring a civil lawsuit for bad faith when an insurer wrongfully denied an insurance claim against the insurance policy.
Contact Our Alabama Insurance Bad Faith Lawyers Today
If you suspect that your insurer denied your claim in bad faith, our law firm can help. You may have a right to file a lawsuit for insurance bad faith in an Alabama court. Successful plaintiffs can recover damages. Contact the Alabama bad faith insurance lawyers at Heninger Garrison Davis today to schedule your initial consultation.
Elements for an Insurance Bad Faith Claim in Alabama
Insurance policy holders can bring a lawsuit for insurance bad faith claims when an insurer wrongfully denies a claim against their insurance policy. Plaintiffs must prove the following to succeed in an insurance bad faith claim:
- An insurance contract between the plaintiff and the insurance company existed
- The defendant breached the contract
- The defendant insurance company refused to pay a claim
- The defendant insurance company had no reasonable or arguable grounds to refuse to pay the insurance claim
Alabama insurance companies often defend themselves by stating that they had a lawful and reasonable reason for denying the insurance claim. When an insurance company can prove a valid basis for their denial of the claim, the plaintiff cannot be liable for a bad faith insurance claim.
Abnormal Bad Faith Insurance Claims
In some certain cases, the plaintiff can bring a lawsuit for abnormal bad faith insurance claims. The plaintiff can bring this type of lawsuit when an insurance company intentionally failed to decide whether they even had an arguable basis for a denial. For example, if an insurance company automatically denied a claim without even considering whether they had a legal right to deny the claim. Alabama law recognizes four different types of abnormal bad faith insurance claims, including the following:
- The insurer intentionally or recklessly fails to investigate a plaintiff’s insurance claim
- The insurer intentionally or recklessly fails to evaluate the plaintiff’s insurance claim
- The insurer developed a reason to deny the plaintiff’s claim that is debatable
- The insurer used ambiguous policy language as the basis to deny the insurance claim
Abnormal bad faith insurance claims are common during Alabama hurricane season. When devastating hurricanes happen, many different insured people make claims at the same time. Insurance companies have been known to quickly go through claims and deny batches of claims without investigating the claims.
The first step in an abnormal bad faith insurance claim is to determine whether the insurance company did have any arguable or reasonably legitimate grounds for refusing to pay the claim. Should the trial court decide that the insurer did have a basis at the time of the denial, the claim cannot proceed.
Damages Available for Bad Faith Insurance Claims in Alabama
Bad faith insurance claims are personal injury claims and successful plaintiffs can recover a full range of damages. In other words, bad faith insurance claims are not simply contract claims with only compensatory damages available. Instead, bad faith insurance claims can include recovery for punitive damages as well as damage for mental anguish.
Successful plaintiffs will be entitled to measurable economic damages that stemmed from the denial of the claim. They will also be entitled to non-economic damages for the inconvenience, stress, pain, and suffering caused by the denial of the insurance claim.
Contact Our Firm
Proving a bad faith insurance claim is not always easy. You will need to prove that there was no legitimate debate regarding the insurance claim. You will need to prove that the insurance adjuster did not have any room to deny the claim on reasonable grounds. Contact our Alabama law firm today to schedule your initial consultation.
