Under common law and California statutes, insurance companies have duties and obligations in which they are supposed to comply with as they handle a claim submitted by a policy holder.
This page is merely an overview of some of the more basic duties an insurance company owes to their policy holders.
An insurance company has a duty to treat their policy holder fairly, reasonably, and in good faith. They have a duty to fully investigate claims submitted by their policy holders. An insurance company should never deny claims prior to making a complete, full, and reasonable investigation.
When an insurance company does deny a claim, they have a duty to provide the policy holder with the grounds and basis for the denial. They have a duty to respond to communications from the policy holder in regards to claims. They also have a duty to exercise diligence in the handling and payment of claims. Insurance companies have a duty to make prompt and full payment on claims when liability is not in dispute.
Further, an insurance company should never harass witnesses, solicit false statements, or threaten to close a file unless the policy holder accepts a low-ball offer. If an insurance company fails to properly perform their duties and they do not treat their policy holder reasonably, their conduct under California law could be grounds for a bad faith law suit. This could result in damages above and beyond the contract benefits under the policy.
If you are a business owner or individual consumer having a problem getting benefits that you believe you are entitled to under your policy please contact our office for a free consultation.