California law states that in a contract between an insurer and policyholder there is a clause called “implied covenant of good faith and fair dealing”. In layman’s terms, this means the company must act in good faith throughout the contract and cannot interfere with a policyholders’ rights. Policyholders have rights to:
1. Receiving coverage for covered risks
2. A proper investigation into a liability for an injury
3. Using good faith to settle all claims
4. Defending the insurer against claims by third parties
When an insurance company fails to uphold these rights, it can be considered a breach of the covenant of good faith and fair dealing. This means a policyholder can instill the help of the experienced personal injury attorney in Los Angeles to file a legal claim for insurance bad faith.
26 total views, 1 today