How to Sue an Insurance Company for Denying Coverage
An insurance policy is a contract. As a policyholder, you uphold your end of the agreement by paying your premiums. In return, the insurance company is required to offer you coverage when it is appropriate. Unfortunately, insurance providers do not always live up to their end of the bargain. Under Georgia law, insurers are required to use good faith settlement practices. When they fail to do so, they can be held legally liable.
If your insurance claim was denied in bad faith or by mistake, you have the right to sue an insurance company for coverage.
know exactly why your claim was denied
When a policyholder with a denied claim turns to Jeffrey D. Diamond, an insurance attorney in Atlanta, asks them for some articles.
“I ask for a copy of the policy, a copy of the fire report or police report, copies of all communications received from the insurance company, copies of damage estimates,” he says, “but the most important document I ever see is the denial letter from the insurance company because that tells me what the problems are.”
Under Georgia law, insurers have a duty to provide a basic explanation for a claim denial. The first step in successfully appealing a denial is understanding exactly why the insurance company made the decision it did. In an appeal/complaint, policyholders must address the stated reason for the denial.
carefully organize the relevant evidence
All successful insurance appeals/claims are based on a supporting evidence base. Once you understand the insurance company’s reasons for denying your claim, you must carefully gather and assemble the relevant evidence to make a strong and persuasive appeal.
The type of evidence an insured needs will always depend on the specific nature of the case. For example, in a property insurance case, the central dispute may be over the full value of the repairs. In this situation, the plaintiff will need to provide evidence to support the value of their losses.
get professional legal representation
“The insurance company is going to insist that you meet several different requests or conditions,” Diamond says. “they know what they’re asking for, and if you don’t play the game right, you can’t put the genie back in the bottle, so to speak.”
The main objective of an insurance company is to protect its own bottom line. Insurers frequently handle coverage disputes, and these companies spend a lot of resources preparing for litigation. If you believe your insurance claim was denied in error or the company acted in bad faith, you need professional representation. An experienced Georgia bad faith insurance attorney can review her case and help you take the appropriate steps to protect her rights and interests. For more information on this area of the law, see our bad faith insurance overview.
Consider filing a bad faith claim
In some cases, insurance companies deny coverage due to reasonable errors or legitimate disputes over fact or law. When this occurs, the insured has the right to file a lawsuit for breach of contract. Of course, there are also other cases where insurance coverage is denied due to negligence or bad faith.
As the Georgia Court of Appeals explained in the case of King v. atlanta case in s. Co., “bad faith” is any frivolous or unfounded refusal to pay in accordance with the terms of the policy. In Georgia, victims of bad faith insurance practices can seek compensation for their original claim and for additional damages, including a penalty of up to 50 percent of the initial value of the claim and full attorney fees and court costs.
georgia is an insurance-friendly state, says diamond, and as such, companies “leverage their financial strength on policyholders.” they rely on policyholders’ lack of knowledge in this field, but lawyers are there to help.
“I’d love to be able to tell people, ‘read your policy,’ but the problem is it’s a bunch of gibberish that no one understands,” says diamond. “They say, ‘If you don’t understand what’s going on, ask questions.’ well, they don’t know what questions to ask. so a lot of times after a loss, people have to fight because they don’t have the proper coverage or understanding.”