Are You Serious? The Stupid Things That Insurance Companies Do: Part 1.
Updated: Sep 24, 2020
MGW lawyers explain how insurance companies can breach their obligations to the insured.
An insurance company has an affirmative duty to make a good faith effort to objectively investigate a disputed loss. Unfortunately, insurance companies all too often breach that obligation to you, the insured. These are just a few examples that make you think “Are you serious?”
Failure to share important information with your insured.
At a very basic level, insurance companies are supposed to take whatever information they have available and make a neutral and detailed decision on your insurance claim. Sometimes insurance companies hide favorable information from you and force you to settle for less. That is not how insurance works. You pay a premium and that immediately triggers an obligation from the insurance company to provide you with the insurance benefits that you paid for. Here is just one example of an insurance company behaving badly. We had an insured that contracted with a company to apply asphalt sealcoating for a storage facility. The company performed the work poorly and over sprayed leaving spots all over the storage unit doors and panels. The question became: how do you get the overspray off the doors and panels? The insured had information from an expert that said they must be replaced because of a variety of factors, including environmental and aesthetic factors. The insurance company retained an expert who agreed with the insured, but told their insured that the panels could be repaired at a much lower cost. The insured then settled for much less than they were entitled to under the insurance policy. It makes you think “Are you serious?”
Accusing your insured of wrongful doing without evidence.
Insurance companies are required to conduct a diligent and neutral investigation. When that investigation strays into accusing an insured of wrongdoing without evidence, that becomes problematic for insurance companies. Here is just one example. There was a fire loss that the insurance company deemed suspicious and this suspicion guided their entire investigation rather than following the facts as required under Wisconsin law. Every opportunity it had during the investigation, it accused the insured of the fire without evidence. What really made this case interesting was the insurance company admitted under oath it did no investigation, had no facts to support the allegation, yet persisted with the allegation anyway. The insured was never charged with arson nor even investigated. That investigation was not neutral, but designed to pay as little as possible. It makes you think “Are you serious?”
These are just a few examples of insurance companies breaching their duties to you, the insured. What makes this behavior most egregious is that the behavior was overt. Most insurance companies take actions to hide information from their insured in more subtle ways. If you feel that your insurance company is not treating you fairly, please do not hesitate to contact the attorneys at MGW Law for a free consultation. We have the experience and knowledge to hold insurance companies accountable.