Dealing with insurance companies is often a major hassle following a car accident. While insurance companies have every right to conduct due diligence before paying out a claim, the Oklahoma Supreme Court has said there is an “an implied duty to of the insurer to act in good faith and deal fairly with its insured.” This duty goes beyond the terms of the insurance policy or contract-it is a legal mandate.
So what happens when an insurer acts in bad faith? Since bad faith is considered a tort, the victim may be entitled to damages not only for their financial losses, but also any emotional distress related to the insurer’s misconduct. Bad faith may also be raised as a counterclaim when an insurer attempts to seek a judicial declaration to avoid paying out on a policy.
Consider this ongoing dispute from northern Oklahoma. The defendant, in this case, was involved in a car accident. The accident occurred in the course of the defendant’s employment. Actually, he was struck by a delivery truck owned by the employer. The truck itself was uninsured, but the defendant was covered by his employer’s uninsured/underinsured (UM) motorist policy.
UM policies are expressly designed to provide benefits in these scenarios-i.e., an insured individual is injured due to negligent operation of an uninsured vehicle. But the insurer apparently made no attempt to investigate or respond to the defendant’s claim for UM benefits. Instead, it proceeded to file a federal lawsuit seeking a “declaratory judgment” that it owed the defendant nothing.
As a counterclaim, the defendant alleged “tortious breach of the insurer’s duty of good faith and fair dealing.” The insurer moved to dismiss the claim. The judge denied that motion, stating the defendant had at least presented a “plausible claim for bad faith.”
While an insurer does not engage in bad faith merely because it refuses to pay a claim or seeks a declaratory judgment, the judge said an accident victim may have recourse when the insurer does “not have a reasonable or legitimate basis to deny the claim or” file a lawsuit. Since the defendant here alleged just that, he was entitled to proceed with his case.
Need Help Dealing With an Insurance Company After a Car Accident?
Insurance companies often count on the ignorance of accident victims when it comes to the law. This is why if you have been in an accident, it is critical to speak with a Tulsa car accident attorney who has experience dealing with insurers and will work to ensure you are treated fairly. Contact the offices of Frasier, Frasier & Hickman, LLP, today to schedule a free consultation.