Bad faith happens when the insurer cannot handle a claim fairly or in good faith. While insurers have a duty to act in good faith and settle legitimate claims, there are instances where delays, low settlements, or unjustified denials may be evidence of unfair practice. You should know what steps to take to protect your interests if you are going through this type of situation.
What Are Signs of Bad Faith Insurance?
Insurance companies like Progressive have a legal mandate to thoroughly investigate claims and make reasonable settlement offers.
Signs of insurance bad faith claims include:
- Long and unexplained delays
- Offering settlements far below what your claim is worth
- Denying a claim without proper reasoning
- Refusing to communicate in a timely manner
Recognizing these behaviors early can help you respond appropriately.
Step 1: Review Your Policy Carefully
Start by reviewing the terms and coverage limits in your policy. Insurers often rely on technicalities. Understanding what is covered and what is excluded can give you more clarity on whether the denial or settlement offer is legitimate.
Then, compare how Progressive is handling your claim to what your policy actually promises. Keeping a copy of the policy on hand will help you check whether the company is honoring its obligations.
Step 2: Document Everything
Documentation is key when dealing with a disputed claim. Keep detailed notes of every phone call, including dates, times, and the names of the representatives you spoke with. Save all letters and email exchanges with the insurer, and if possible, request written confirmation of verbal promises.
Supporting evidence such as medical records, police reports, or repair estimates can also strengthen your case. A clear record makes it harder for the insurer to dismiss your concerns later.
Step 3: Communicate in Writing and Stay Professional
Whenever possible, follow up on calls with written communication. Written records create a paper trail that may prove essential if your case escalates. Keep your tone professional and stick to the facts rather than emotion.
Insurers are more likely to take you seriously when your communications are well-documented and clear.
Step 4: File a Complaint with the State Insurance Department
If you continue to face resistance, consider filing a complaint with your state’s insurance department. These regulatory agencies oversee how companies like Progressive handle claims and investigate when people report unfair treatment.
While the process may not resolve the dispute immediately, it adds a layer of accountability. The National Association of Insurance Commissioners (NAIC) and state insurance departments use data from policyholders’ complaints to identify patterns of misconduct and regulate the industry.
Step 5: Talk to a Bad Faith Insurance Attorney
When insurers persist in denying or underpaying valid claims, consulting an attorney may be the most effective step. An experienced lawyer can evaluate your case to determine whether bad faith occurred, negotiate with the insurance company, and even file a lawsuit if necessary.
In some states, victims of bad faith can recover not only the original claim value but also additional damages. This includes compensation for financial stress or punitive damages to punish the misconduct of the insurance company. Courts and legal experts note that civil litigation is often the most effective way to hold insurers accountable for systematic unfair practices.
Key Takeaways
- Bad faith happens when an insurer delays, denies, or underpays a claim unfairly.
- Review your policy to compare Progressive’s actions against its obligations as clearly outlined.
- Document all communication and evidence related to your claim.
- Communicate in writing to build a strong paper trail.
- File a complaint with your state’s insurance department if necessary.
- Consult a lawyer for legal options if unfair treatment continues
