Your insurance company owes you a duty of good faith and fair dealing when you make a claim for benefits under your policy. A violation of this duty, or a bad faith claim, arises when your insurance company denies benefits without a reasonable basis. In Nevada, insurers are also held to further standards under the Unfair Claims Practices Act.
In claims involving automobile collisions, bad faith can arise generally in two circumstances: (1) when an insurance company fails to defend its insureds adequately in response to a liability claim, and (2) when an insurance company improperly denies or minimizes an uninsured/underinsured motorist (UM) claim. While we deal with both circumstances, bad faith involving the UM claim is more common. A UM claim can be made when an insured is injured by a driver who has either insufficient or no liability coverage.
Of course, you must carry uninsured/underinsured motorist (UM) coverage to make a UM claim. Many drivers in Nevada do not carry UM coverage. We highly recommend purchasing UM coverage because many Nevada motorists are uninsured. If an uninsured motorist hits you, and you carry no UM coverage on your policy, you may be unable to recover anything to compensate you for your loss.
When you make a UM claim, your insurance company is required to deal with you in fairness. This is because the relationship between insured and insurer is fiduciary in nature. Insurance companies must, therefore, avoid using any arbitrary, abusive, or coercive tactics in handling claims. They must carry out a thorough investigation and respond promptly to your requests for information, among other requirements outlined in judicial decisions and the Unfair Claims Practices Act.
Nevertheless, insurance companies often attempt to undervalue UM claims or deny them altogether, using one or a combination of bad faith practices. Insurance companies may deliberately misinterpret policy language, for example, or they may apply a standard in reviewing your claim which is completely arbitrary to avoid paying your claim. More often, insurance companies act in bad faith by employing medical experts to review your medical records with the intent to devalue your claim. While insurance companies may properly rely on medical experts, insurance companies cannot rely on an expert who they know to be biased.
We have brought cases involving all these bad faith scenarios to successful conclusions. We understand insurance bad faith because we have experience working for insurance companies. In the past, we have even defended insurance companies against bad faith complaints. We know how to apply pressure on insurance companies to treat their insureds fairly.