An insurance company has to defend against lawsuits just like everyone else, but it’s rarely the insurance company that you see in court or named in the lawsuit. They’re more behind-the-scenes, proving the funding for the defense and being responsible for the outcome of the case. When you get into a car crash with John Smith, it may seem like you’re suing John Smith. Really though, he’s being represented by his insurance company, and it’s the insurance company that you’re actually taking action against. The defense is paid for by the insurance company. The insurance company is the one providing for payment for compensation. So you shouldn’t hesitate to take legal action against John Smith, even if he’s someone you know because he isn’t paying for the defense or the compensation. And if you’re seeking a suit against an insurance company, the way to do that is by proxy.
You may also have a situation where you have uninsured motorist coverage. If you’re in an automobile action and someone hits you but they don’t have insurance of their own, you’d be filing a direct action to your own insurance company. Almost every lawsuit and you see it in court, you’re in front of the jury— or if you’re a member of the jury— you see that the defendant has representation or counsel but really it’s the insurance company that’s running the show, whether that be litigation and the defense for them. The easy thing to say is you can sue an insurance company by filing a lawsuit. While the insurance company might not be the directly named party, they’re the one behind the scenes, paying for the defense and ultimately paying for the compensation.
You can also file a lawsuit against your own insurance company if you feel as if you’ve been mistreated or shortchanged, or if it seems like the terms of your policy have been violated. The main reason to bring a claim against your insurance company is that you feel as if they were not acting in good faith. Maybe they fulfilled the terms of your contract, but they were clearly acting against your best interests or against fairness. If your case is improperly investigated, leading to problems with your claim— especially when those problems make it possible for them to avoid paying you or pay you less— the company has acted in bad faith. If they have intentionally evaded you, failed to communicate, or postponed your payment, they have acted in bad faith. If they refuse to negotiate or insist on paying far less than what is actually owed, they are acting in bad faith. Any of these circumstances can be a cause to bring a lawsuit against them and reasonably expect to prevail. Insurance companies have a duty to their clients, who, by right of filing a claim, are already in strained circumstances. By taking advantage of a client who may be in a position where they can’t afford to negotiate or can’t act in their own best interest, they are failing that duty. It’s worth noting that insurance lawsuits usually take some time to settle, so this is not an option to pursue if you’re looking for a quick payout. Because of this, you want to find a lawyer who is in it for the long haul. If you’ve been wronged by your insurance company or want to bring a suit against someone else’s insurance, contact us and let us do the heavy lifting.