Good Faith and Bad Faith
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"Good Fath and Fair Dealing"
The duty of “Good Faith and Fair Dealing” deals with how insurance companies must act in regards to:
1. The adjustment of your claim, whether it be a bill or payment, within a reasonable amount of time,
2. Cooperating with you in regards to the claim, ( a timely response to any medium of communication )
3. Notifying you in writing of any claim being denied in addition to the specific contract term(s) or provisions(s) upon which it relies,
4. Must attempt to find a basis to pay the claim rather then find reasons to deny it, and
5. “playing fair” as the duty itself implies.
Understanding Your Insurance Company's Role as a Fudiciary
Generally, the law recognized there major fiduciary duties:
1. duty of loyalty, i.e. a fiduciary must not place his or its own interests ahead of the beneficiary’s interest;
2. duty of care, i.e. a fiduciary must exercise an amount of care appropriate to manage the beneficiary’s interest; and
3. duty of disclosure, i.e. a fiduciary must disclose certain information to the beneficiary.
The following are encapsulations of duties outlined in Berumen’s Do No Evil: Ethics with Applications to Economic Theory and Business, which seems to apply to all fiduciary relationships.
- Fiduciaries are responsible for ensuring that they have the necessary knowledge to perform in accordance with their capacity.
- Fiduciaries must disclose any limitations, conflicts of interest, or barriers in performing their duties.
- Fiduciaries must comply with any legal and professional requirements pertaining to their roles, and also with any relevant moral structures.
- Fiduciaries must not take unfair advantage of their relationship (e.g., misuse of information) in a way that could have disastrous effects on those who place their confidence in them.
Examples of Bad Faith
Some or all of the following things have been found ( in some states) to constitute “Bad Faith” or an “Unfair Dealing” by an insurance company from whom you purchased a policy.
Bad Faith is not a common thing, and from our experience should only be pursued if a breach of contract has clearly been broken. Speak with your insurance company and express how you feel before deciding to get legal help. In many cases it may just be a simple misunderstanding between people that can easily be worked out.
Examples of these may include:
1. Failure to promptly investigate a claim.
2. Failure to properly , thoroughly and reasonably investigate a claim as to liability and damages, if any.
3. Failure to fairly and reasonably evaluate fact of liability.
4. Failure to offer settlement within a reasonable amount of time after investigation and evaluation in favor of its insured, if such occurs.
5. Delay in payment to await settlement with a third-party insurer.
6. Failure to fairly and reasonably evaluate damages.
7. Non-disclosure of information.
8. Failure to inform insured of additional benefits due under the policy.
If, as stated before, you suspect any foul play or unfair dealing on your adjuster or insurance company’s behalf after working with them, or you believe they have not lived up to the provisions in your insurance policy, you have the option to file a complaint with the Department of Insurance or contact a personal attorney.
Please do bear in mind, however, that the Department is an administrative agency and not a court of law. Therefore, we are not able to decide questions of fact, such as whether or not damage to your roof was caused by hail or other factors. We can,and will, however, review the company’s handling of your claim to ensure that they have done all that they can do to comply with Texas insurance laws.
We know that this might seem like an overwhelming process for the first-time homeowner, or anyone who might not have enough experience in this area. For this reason, we at 1A Roofing and Construction are here to extend our knowledge and expertise to help our customers all throughout the roofing hail claim process and to personally deal with their insurance company on their behalf to ensure that all bases of their property are addressed and accounted for. Feel free to call us today at (817)203-4546 if you have any questions or concerns about your roof and property, or if you would be interested in one of our excellent roofing and construction services. We look forward to serving you!