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This blog does not create an attorney-client relationship. You should not rely upon this blog for legal advice, but instead should consult an attorney experienced in your area of concern.

Insurance Bad Faith Hits Poor Families the Hardest

Our firm has litigated numerous insurance bad faith cases representing clients across the board.  In terms of property claims, these cases have ranged from multi-million dollar losses to corporate buildings, to million dollar losses to large wealthy homes, to minor losses to small private homes.  Invariably, however, the smaller losses to indigent families are the most troubling.

Bottom line, insurance companies make money by denying claims or limiting payment on claims.  For large companies and wealthy individuals, a denied insurance claim can be just a small headache.  But for a single parent with two jobs whose roof is leaking and plumbing is not operational, the headache can turn into a debilitating nightmare.

If your insurance claim is denied or payment is minimal, it is important to have an attorney review your insurance contract and any communications from your insurance company regarding the denial.  If the damage to your home is a covered loss, depending on your type of coverage, you are entitled to either the actual cash value of the damage or replacement value.

Additionally, Chapter 58 of the North Carolina General Statutes requires that all insurance companies operate in good faith with respect to claims made by their insureds.  This includes requirements such as: affirming or denying coverage in a prompt manner; promptly investigating your claim; not denying a claim for an improper purpose; not providing justification as basis for denial of a claim, etc.

Do your homework any time you make an insurance claim.  Insurance companies have a duty to their insured and the laws of North Carolina interpret insurance contracts in favor of the insured and in favor of coverage.  


This blog does not create an attorney-client relationship. You should not rely upon this blog for legal advice, but instead should consult an attorney experienced in your area of concern.

Insurance Bad Faith

This blog does not create an attorney-client relationship. You should not rely upon this blog for legal advice, but instead should consult an attorney experienced in your area of concern.

Chapter 58 of the North Carolina General Statues prohibits an insurance company from doing certain wrongful acts.  More specifically, the statute is called the Unfair Claim Settlement Practices

N.C. Gen. Stat. Ann. § 58-63-15. 

Unfortunately, these claims cannot be brought against someone else's insurance company, but only your insurance company.  If there is a single violation of the Act, the insured is entitled to recover treble damages and attorney fees under Unfair and Deceptive Trade Practices Act (Chapter 75 of the North Carolina General Statutes).  

 The acts that are prohibited include:

a. Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue;

b. Failing to acknowledge and act reasonably promptly upon communications with respect to claims arising under insurance policies;

c. Failing to adopt and implement reasonable standards for the prompt investigation of claims arising under insurance policies;

d. Refusing to pay claims without conducting a reasonable investigation based upon all available information;

e. Failing to affirm or deny coverage of claims within a reasonable time after proof-of-loss statements have been completed;

f. Not attempting in good faith to effectuate prompt, fair and equitable settlements of claims in which liability has become reasonably clear;

g. Compelling the insured to institute litigation to recover amounts due under an insurance policy by offering substantially less than the amounts ultimately recovered in actions brought by such insured;

h. Attempting to settle a claim for less than the amount to which a reasonable man would have believed he was entitled;

i. Attempting to settle claims on the basis of an application which was altered without notice to, or knowledge or consent of, the insured;

j. Making claims payments to insureds or beneficiaries not accompanied by a statement setting forth the coverage under which the payments are being made;

k. Making known to insureds or claimants a policy of appealing from arbitration awards in favor of insureds or claimants for the purpose of compelling them to accept settlements or compromises less than the amount awarded in arbitration;

l. Delaying the investigation or payment of claims by requiring an insured claimant, or the physician, of or either,¹ to submit a preliminary claim report and then requiring the subsequent submission of formal proof-of-loss forms, both of which submissions contain substantially the same information;

m. Failing to promptly settle claims where liability has become reasonably clear, under one portion of the insurance policy coverage in order to influence settlements under other portions of the insurance policy coverage; and

n. Failing to promptly provide a reasonable explanation of the basis in the insurance policy in relation to the facts or applicable law for denial of a claim or for the offer of a compromise settlement.

N.C. Gen. Stat. Ann. § 58-63-15 (West)