BAd faith insurance claims


Insurance contracts involve a “special relationship.”  Because of this special relationship --- which arises from you paying premiums for an insurance company to protect you from financial ruin --- an insurance company owes you certain duties, like the “duty of good faith and fair dealing,” and the duty to give your interests “equal consideration.”  When an insurance company breaches these duties, it is said to be acting in “bad faith.”

An example of an insurance company acting in “bad faith” would be when the insurance company puts its own interests --- profits --- ahead of yours.  This may arise when the insurance company denies a legitimate claim so that it makes more money.  If it does this, you may have damages “outside the contract.”  This means your damages aren’t just what you paid premiums to cover, like the monthly disability benefit the insurance company owes you.  You may be harmed in other ways.   

For example, if an insurance company wrongfully denies a disability, health insurance, or other claim, you may have huge medical bills, be unable to make your mortgage payment because you can’t work, or be unable to pay for other necessities.  The law agrees that insurance companies shouldn’t be allowed to act like this.  Therefore, the “bad faith” laws allow you to seek damages to right the insurance company’s wrong.  And if the insurance company’s behavior is particularly bad, you may also be able to recover “punitive damages.”  These are monetary damages designed to punish the insurance company so it won’t act in bad faith again. 

But, bad faith and punitive damages are not available in ERISA cases.  However, even if the insurance company says your claim subject to ERISA, which would mean no bad faith or punitive damages, one of the ERISA exceptions may apply.  If it did, you could seek compensation for the harm caused by an insurance company’s wrongful denial. 

Patrick has litigated numerous bad faith and punitive damages case.  If you have questions for a lawyer about whether your insurance company engaged in bad faith behavior, contact Patrick today for a Free Consultation. 

in non-erisa Insurance cases, bad faith and punitive damages may be available 

An insurance company acts in bad faith when it puts its own interests --- profits --- ahead of your interests.  If an insurance company does this, you may be able to recover damages to compensate you for the damages caused by the insurance company’s actions.

Patrick has litigated numerous insurance bad faith cases.  If you questions about your insurance company’s actions, contact Patrick for a free consultation

The information on this website is intended to be informational only and does not establish an attorney/client

relationship, nor is it meant to give or be legal advice for a specific matter.  Please do not email or fax information to

Patrick Mause without first speaking or meeting with him because the information will not establish an attorney/client

relationship and may not be kept confidential. Patrick Mause is a lawyer admitted to practice only in Arizona, the Arizona

District Courts, and the Ninth Circuit Court of Appeals.  His office is located at 290 North Meyer, Tucson, Arizona 85701.