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Practices

BAD FAITH CLAIMS

Bad faith claims involve a myriad of alleged wrongdoings including improper claim investigation, claim administration, settlement or claim denial. Litchfield Cavo attorneys minimize the risk or validity of bad faith claims proactively by implementing risk management strategies to prevent such claims, and then mounting an aggressive and thorough defense when they are asserted.

Mere allegations of bad faith can be devastating to an insurer’s reputation and, ultimately, their bottom line. Litchfield Cavo attorneys have significant experience counseling clients on bad faith matters and address the nuances of bad faith litigation to protect clients’ interests throughout the claim handling process to avert bad faith claims on many levels, including:

  • Attorney fees | Most bad faith statutes or laws allow the insured to recover its attorney fees and costs.
  • Exposure of confidential files | The discovery process may force an insurer to reveal confidential files and protected attorney-client communications for the case at hand and, in some instances, for any similar cases. These documents quickly become public and are usually resurrected in litigation for years to come.
  • Extra-contractual damages | Judgments in excess of a client’s policy limits.
  • Punitive damages | In some states, insurers face punitive damages or treble damages on a bad faith award.

Our attorneys offer a nationwide practice with a thorough understanding of the varying state insurance laws and bad faith theories that can come into play.

Our Bad Faith Record

  • Defense of insurance company against bad faith claims for not “splitting” a file, notwithstanding the insurer’s unreserved acceptance of the tender of defense.
  • Successfully defended bad faith claim arising from the settlement of multiple bodily injury claims where the policy limits were insufficient to cover all claims.
  • Successfully defended bad faith claims related to set-off provisions of an underinsured motorists benefits policy.
  • Obtained favorable jury verdict in a claim involving the alleged bad faith denial of coverage and alleged non-compliance with policy reporting requirements under a stop-loss warranty policy.
  • Obtained favorable jury verdict in a statutory bad faith action arising from the carrier’s alleged failure to settle a case after liability was reasonably clear.
  • Successfully defended allegations of bad faith claims handling as part of a multiple site environmental coverage matter involving thousands of underlying claims.
  • Obtained summary judgment in numerous declaratory judgment actions on substantive coverage issues, and resulting in a summary judgment on the companion bad faith claim.
  • Successfully defended a common law and statutory bad faith claim involving the alleged improper investigation and denial of a multimillion-dollar claim.
  • Successfully defended healthcare insurer from bad faith charges after having denied coverage for a procedure it deemed experimental.
  • Obtained jury verdict in favor of our client in a multiple defendant case involving alleged bad faith settlement practices.