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Louisiana Home Insurance: When Is My Insurer in Bad Faith?

louisiana home insurance

Is your Louisiana home insurance claim taking forever?

Is your insurance company refusing to pay or offering you a settlement that doesn’t even cover your damages?

If your home insurance isn’t putting your best interests first, they may be acting in bad faith and can be held liable. Keep reading to learn more about bad faith and what to do if your insurance company isn’t playing fair. 

What is Bad Faith?

When you purchase an insurance policy, you are entering into an agreement with your insurance company. Because insurance companies are for-profit businesses, the government requires them to do right by their customers.

Insurance companies are legally required to treat their policyholders fairly and operate with honest, good intentions. Unfortunately, this doesn’t always happen.

Sometimes insurance companies deny claims or undervalue claims without good reason. When an insurance company acts unethically and doesn’t do right by their policyholder, they can be held liable for their actions.

Insurance companies are required to act in the best interest of their insured, or in good faith. When they fail to do this, they are acting in bad faith. 

Bad Faith in Louisiana

In the State of Louisiana, there are two main laws related to bad faith. These laws work to prevent insurance companies from taking advantage of claimants. 

RS 22:1973

This statute requires insurers to act in good faith and to deal with claimants in a fair manner. The law requires insurance companies to handle claims in a timely manner and to make an effort to settle every claim. Under this statute, if an insurer intentionally does any of the following, they are acting in bad faith:

  • Being dishonest about facts or policy provisions related to coverage
  • Being dishonest about when a claimant may file a lawsuit
  • Failing to fairly compensate an insured within 60 days of receiving sufficient proof of the loss without good reason
  • Denying coverage or offering a settlement on the basis of an application that was altered without the insured’s knowledge
  • Failing to pay an insured for a settlement within 30 days after a written agreement to do so
  • Failing to pay claims related to immovable property without reasonable cause 

RS 22:1892

This statute outlines the time requirement insurance companies must adhere to when adjusting and paying claims.

Insurance companies are required to pay claims fairly and within a reasonable time frame after an insured has filed a claim. Once an insured has provided proof of loss, the insurer must begin adjusting the claim within 14 days. This deadline is extended to 30 days in the case of a large-scale natural disaster or catastrophic loss.

Insurance companies are required to make an offer to settle property damage claims within 30 days of receiving sufficient proof of loss. This deadline may be extended up to 30 days if the state or federal government declares a state of emergency. 

Damages in Bad Faith Claims

The damages you can recover if your insurance company is found to be acting in bad faith depend on which statute they have violated. You may be able to recover the damages from your loss as well as penalty fees and attorneys’ fees.

You may also be entitled to further compensation. Working with an attorney can help you maximize your recovery. 

What is Not Bad Faith

While it’s important to understate what constitutes bad faith, you should also understand what circumstances do not qualify as bad faith in the eyes of the law.

Oftentimes, insurance companies intentionally reduce the value of claims or take their time before paying. But sometimes, mistakes happen. Not every claim that is denied or reduced will qualify as bad faith.

If the insurance company has a good reason for making a mistake, they have not acted in bad faith. For an insurer to be found in bad faith, they have to know that what they are doing is unfair.

Speaking with an attorney is the best way to determine whether your insurance company may be acting in bad faith or has just made a mistake that can be remedied. 

What to Do if Your Insurance Company Is Acting in Bad Faith

If you believe your insurance company is acting in bad faith, you can fight back.

The first thing you should do is hire an attorney who specializes in bad faith insurance claims in your state. Each state has its own laws, department of insurance, and procedures for bad faith claims.

Most state insurance departments recommend hiring an attorney when you are involved in an insurance dispute. However, they don’t pay for this.

Fortunately, hiring an attorney won’t cost you anything out of pocket. Insurance claim lawyers work on a contingency fee basis. This means that they only get paid if you win your case and receive additional money.

Your attorney will be paid part of your settlement. Most home insurance policies have a stipulation that requires the insurance company to foot the bill for your attorneys’ fees if they are found to be acting in bad faith. They can even face monetary penalties.

This means that you will get your settlement and your lawyer will be paid directly by the insurance company. 

Is Your Louisiana Home Insurance Acting in Bad Faith?

Is your Louisiana home insurance company refusing to pay your property damage claim?

Are they only offering a lowball settlement that isn’t enough to cover your damages or make repairs?

Your insurance company can’t do that. You have the right to fair and honest treatment and the payment you deserve.

Our experienced homeowners’ insurance claim lawyers are experts at getting policyholders the compensation you deserve.

Click here to schedule a free consultation today. 

Babcock Injury Lawyers

Babcock Injury Lawyers
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