Good Faith, Bad Faith and Insurance Profits

Posted Tuesday, December 11, 2007 by Ed Harper

As an insurance policy holder, an insurance company is supposed to act in Good Faith. This means an insurance company has a duty to act in the following manner:

Honor your requests and assist you in resolving your claim

Pay or deny you claim within a reasonable period of time

Respond promptly to your requests

Provide notification in writing of the reasons they are not paying your claim

Bad faith insurance practices can include any of the following:

Not investigating your insurance claim

Unreasonably delaying the investigation of your claim

Not paying promptly benefits you are entitled to receive

Making an unreasonable low payment offer on your claim

Not disclosing policy limits

Not renewing your insurance policy after a claim has been filed

Terminating your insurance policy after a claim has been filed

Treating the insured as an adversary

Additionally, profits are up for insurance companies. Reports indicate that profits are at $73 billion for 2006. This is up 50% over last year and come on the backs of insured’s premium checks.

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