Insurance Bad Faith Law – Can I Sue My Health Insurance Company?

Legally Reviewed and Edited by: Terry Cochran

The purpose of insurance is to cover you when things go wrong. However, it can come as a shock for victims of medical negligence if a claim is rejected.
You may wonder, “can I sue my health insurance company for negligence” or “can I sue my health insurance company for emotional distress.”
Negligence, emotional distress and much more may be covered by the bad faith law.

However, fighting a bad faith insurance claim can be a tough battle, which is why you need our top medical malpractice lawyers in Michigan fighting in your corner.

What is the Bad Faith Law?

The health insurance marketplace allows you a choice of health plans.

Insurance companies have a duty to operate in good faith and fair dealing. Health insurance plans may not always specifically mention bad faith. However, when your insurance company fails to meet its obligations under the terms of your policy, you can file a bad faith claim against your insurer.

The Bad Faith Law allows you to take action against your insurance company if you think they’ve acted illegally when dealing with your claim. This can include misrepresenting you, providing false information about you, fraud or any other form of dishonesty that they use to justify not fairly settling your claim.

You can also file a bad faith lawsuit if your insurer fails to payout in a reasonable amount of time, resulting in further harm to you.

Michigan state laws often address bad faith practices, called unfair claims practices acts, aimed at preventing insurers from attempting to reduce claim amounts or unfairly deny claims.

If you believe that you’re the victim of an unjust insurance claim rejection, consider hiring a team of super lawyers to sue your health insurance company.

What Acts are Considered Bad Faith in Insurance?

Bad faith practices are rife among health insurance companies, especially in claims where medical malpractice occurs resulting in the wrongful death of a family member, a birth injury or someone suffering cerebral palsy as a result of substandard health care.

Insurance claims made in relation to errors made by medical professionals, such as doctors, nurses and other healthcare professionals, are common. However, insurance companies are reluctant to payout.

Prime examples of insurance companies acting in bad faith, include:

• Denying you claim for no reason: If your insurance company denies your claim, a clear reason must be given as to why it was rejected. Your insurer cannot send you a letter simply saying “your claim has been refused.” A genuine reason for rejecting your claim must be provided.
• Unreasonable delay in investigating your claim: If you make a claim and your insurer takes an unreasonable amount of time to investigate it, that’s bad faith. If your insurer is ignoring your calls or fails to speak to people involved in your malpractice claim they are often tactically avoiding you and pursuing your claim in the hope that you will give up.
• Payment delays: Sometimes insurance companies will delay payment to hold onto money for an approved claim. If you’re a victim of medical malpractice this can affect any existing or future medical bills you have to pay.
• Not paying the value of your claim: Insurance companies are always reluctant to payout and even if your claim is approved, they may well undervalue and offer you less money than it was worth.
• Failure to defend your claim: Your insurance company will most likely have a legal duty to defend a lawsuit, even if the coverage for your claim is called into question. Your insurance company should cover the cost of a medical malpractice attorney, but failure to do so means you can make a bad faith claim against them.
• Changing the meaning of insurance policy language: Insurance contracts tend to be long, complex and full of jargon. Insurance companies often capitalize on this, taking advantage of people’s lack of understanding about their policy and reinterpreting language to avoid paying out. When making a bad faith claim, it’s advised that you seek legal advice from insurance lawyers at Cochran, Kroll, & Associates, P.C.
• Accusations of fraud against you: Some insurers have been known to accuse policyholders of fraud to delay or avoid paying out, turning the tables on you to provide more evidence than is needed to prove your claim is valid. Your insurance company is not allowed to threaten you with legal action as it’s deemed unlawful intimidation, which is illegal.

What Do I Need to File a Bad Faith Insurance Suit?

You will need to show that you have, in good faith, tried to settle any dispute with your insurance company. This will require at least two internal appeal reviews and one external review.

If you have been unable to resolve a dispute with your insurer directly, you can file a bad faith claim and you should hire a Michigan attorney to help you. Insurance companies have the funds to fight you in any claim that you make against them.

Cochran Kroll, & Associates, P.C. have decades of experience with medical malpractice cases. We have helped hundreds of clients obtain punitive damages due to medical errors and poor medical care by providers. We offer the experience and legal knowledge you need to ensure a successful outcome for your case.

To help build a case against your health insurance provider we need to understand your contract and your policy to determine what is covered. If you have any written or recorded correspondence with your insurer, this can help us to build an accurate case with all the facts.
It’s possible to obtain recordings from your insurer as many will record conversations for training purposes and you’re within your legal rights to ask for copies or any recorded or written correspondence held by your insurer.

If they fail to disclose any information that is relevant to your bad faith claim, a court can order your insurer to submit any correspondence as evidence.

While building a case against your insurer, do not sign anything without discussing it with your Cochran Kroll, & Associates, P.C. attorney. Your insurer may attempt to settle outside of court to avoid any bad publicity, incurring legal fees or because they fear losing the case.

However, you may achieve a lower settlement than you can in court, so let us scrutinize any document your insurer asks you to sign before you commit to anything in writing.

What Can I Recover?

What you recover will depend on the facts of your case and proving your insurance company failed to meet its obligation as your insurer. Damages could include:

• All your economic losses, including medical bills, out of pocket expenses related to the denied claim, lost wages or other earnings and lost interest.
• All your legal fees.
• Non-economic losses suffered such as pain and suffering, anxiety, emotional stress, and even loss of consortium.

If you can prove that you were misled when purchasing your policy as to the level of cover provided, the court may order the company to pay all your losses in full, even if it’s more than your coverage is worth. In addition, the court may order the company to pay penalties or exemplaries if they are found to have acted in bad faith.

In 1980, a significant bad faith claim case involved Kewin v Massachusetts Life Ins. Co. This case set a legal precedent on the limits imposed on the amount for damages awarded to a plaintiff who successfully sues their insurance company for failing to adhere to the terms of a contract.

Choose Cochran Kroll, & Associates, P.C. for Your Bad Faith Claim

You need a good insurance lawyer on your side, and if you live in Michigan, including Ann Arbor and the surrounding area, Cochran Kroll, & Associates, P.C. can help with a bad faith claim against your insurance company.

Eileen Kroll is a registered nurse and personal injury trial attorney, at Cochran, Kroll & Associates, P.C. Eileen has a unique understanding of medical malpractice laws and health insurance coverage, which positions her to achieve the best possible outcome in your bad faith claim. Call our law firm at 866-MICH-LAW for a free consultation to discuss your case.

Disclaimer : The information provided is general and not for legal advice. The blogs are not intended to provide legal counsel and no attorney-client relationship is created nor intended.