Things to Watch out for in the Florida 2016 Legislative Session: Hold Insurance Companies Responsible by Keeping Florida’s Bad Faith Law Alive
2015 HB 1088 and SB 1197 which did not survive committee, sought to protect insurers when they have acted in “bad faith.” Currently, Florida allows for both first party and third party bad-faith actions against insurance companies. “Laws that require insurers and other businesses to act in good faith are good public policy benefiting both policy holders and victims. The reason policyholders pay premiums to insurance companies is to protect themselves legally and financially, and grant insurers the exclusive control over decisions to investigate, evaluate, and settle claims against the policyholder, or, when necessary, litigate on their behalf. When an insurance company acts in bad faith, it betrays the trust placed in them by their policy holders and exposes them to the potential of financial ruin. Florida’s bad faith law is the private, free market alternative to additional insurance regulation.” FJA 2016 Issues Booklet.
Insurance companies are required to act in good faith, for the benefit of their policyholders to:
- Promptly investigate and evaluate all property, casualty, motor vehicle and other insurance claims made against their policyholders;
- Whenever possible, promptly settle claims filed against their policyholder for an amount that is at or below the insurance contract policy limits; and
- Financially protect their policyholders from:
- Judgments that are in excess of their insurance contract policy limits;
- The exposure of their business and/or personal assets; and
- Being forced to file for bankruptcy.
(Source: Florida Justice Association)
“An insurance company acts in bad faith by refusing to accept a reasonable settlement offer or failing to inform the policyholder of the offer in a timely manner. As a result of such omissions, the insurance company exposes their policyholders to a court judgement that could exceed the policy limits…” thus personally exposing the policyholder. (FJA)
If you are having trouble obtaining benefits from your insurance company, or if you feel that your insurance company is not protecting you adequately, call Friedman Legal today for a free no-risk consultation at: 888-411-1677