If you are working with an experienced attorney in suing an insurance company, you likely have many questions. Below, we try to address some of the most common questions that come up:
Circumstances Surrounding Insurance Lawsuits
There are several ‘warning signs’ that might indicate that it is time to hire an experienced bad faith insurance attorney, such as:
- If the insurance company has asked you to speak with its attorney
- If you’ve experienced significant delay in your claim being paid
- If your claim is outright denied even though you believe you have coverage for the incident or item
Regardless of whether you plan to bring suit or not, documenting everything is important. Keeping pictures, videos, receipts, phone logs, and any other documentation will help you credibly demonstrate any losses you’ve suffered. This includes obtaining all the relevant documentation, such as the denial, evidence of coverage, any guidelines they have surrounding their reasons for the denial, etc.
In addition, make it clear to the insurance company that you are dissatisfied and make sure that you first exhaust all internal processes that are required—such as requesting an appeals process or administrative hearing. However, be careful about what, if anything, you transmit by letter or email during this time: keep it simple and professional so that you make it clear–if a jury eventually reviews the issue–that you yourself operated in good faith.
Lawsuits against insurance companies are usually either filed strictly based on breach of contract—where the company simply didn’t follow the terms of the policy—and/or bad faith—where there were damages associated with the company’s conduct, especially any mental or emotional damages if the conduct was egregious in any way. In Oklahoma, the Supreme Court established that bad faith is an independent tort upon which an insurer can be held liable for compensatory and punitive damages for the delay or denial of a claim that is not reasonably in dispute. An insurer’s obligation isn’t just limited to paying claims, but rather dealing fairly and acting in good faith with the insured, where violations of this duty can incur liability. However, in order to prove that an insurer acted in bad faith, courts require a clear showing that the insurer acted unreasonably and withheld payment of the claim in bad faith. Keep in mind that this does not mean that a plaintiff has to prove that there’s been intention to harm or deceive the insured, simply that there has been conduct that implies negligence and/or recklessness.
The Contingent Fee System
Some people are concerned that perhaps they would not be able to afford an attorney to challenge their insurance company, even though wrong has been done. However, the contingent fee system allows you to work with an attorney without paying out of pocket. Essentially, it works by your attorney being paid a percentage of the amount recovered from the insurance company; in other words, if there’s no recovery, there’s no fee paid to the attorney.
Oklahoma allows you to hire an attorney on a contingent fee basis. That agreement must be in writing and signed by the client and should state the method by which the fee is to be assessed, including the specific percentages that accrue at various stages of litigation. For example, the fees imposed may be different if the case is settled during trial.
In addition, the fee agreement should clearly state whether any expenses will be deducted before or after the attorney fee is calculated. And if the attorney plans to seek reimbursement for any advanced costs from the client in the event that there is no recovery, this must be stated clearly in the fee agreement. It is also recommended that clients be kept informed of costs as they are incurred in the form of a monthly recap and candid discussions about costs on a regular basis.
If you sue your insurance company and win, you can recover economic losses, non-economic losses, attorneys’ fees, punitive damages, others; specifically:
- Property damage and loss of use of your car, home, etc.
- Medical bills
- Lost wages
- Attorneys’ fees for having to sue
- Losses resulting from unpaid insurance benefits
- Emotional and pain and suffering from the insurance company’s conduct
- Any relevant punishment for insurance company’s failure to honor police
Oklahoma City Lawyers Representing Claims against Insurance Companies
Our firm is focused on representing clients who have bad faith claims against their insurance company, whether that involves auto insurance, life insurance, extended warranties, homeowner’s insurance, health insurance, or others. We are here to assist you with your case. Contact us today to obtain more information on how we can help—we serve clients all over Oklahoma, (405) 272-0303.