When children depend on the stability that insurance benefits are supposed to help restore, bad faith practices can disrupt their everyday lives.
Consider a family whose home suffers major damage from a fire, storm or another covered event. If an insurer unreasonably delays paying for repairs or temporary housing, children may spend longer than necessary living in a hotel, with relatives or in another temporary arrangement. That instability can interfere with school transportation, friendships, extracurricular activities and familiar routines.
Financial pressure can create additional problems. Parents who expected insurance to cover a legitimate loss may suddenly need to use savings or credit cards for repairs, replacement belongings and other necessities. Money that would otherwise pay for childcare, activities or family expenses may need to be redirected while their claim remains unresolved.
Children may also feel the emotional effects of an insurance dispute without understanding what is happening. A child who has already experienced the frightening loss of a home or belongings may become anxious when uncertainty continues for months. Stress experienced by parents can also affect the atmosphere throughout an affected household.
What can be done?
Not every claim delay or denial amounts to insurance bad faith practices that are legally actionable. Insurers generally have the right to investigate claims and resolve legitimate coverage questions. Problems may arise, however, when a company lacks a reasonable basis for denying benefits, fails to conduct an appropriate investigation or otherwise handles a claim contrary to its legal obligations. Families facing these circumstances may have solid grounds upon which to pursue justice.
When an insurance company’s conduct affects an entire household, resolving the dispute at issue can help to restore stability for children and their parents alike. An experienced bad faith insurance legal team can evaluate how a claim was handled, communicate with the negligent insurer and pursue available remedies while parents focus on helping their children regain a sense of normalcy.