It seems that sometimes insurance companies believe they can get away with displaying bad faith actions with policyholders after paying out a claim appraisal. Despite that mentality, the courts in Illinois beg to differ.
A recent case outlined on the Property Insurance Law blog points to an issue with mentality that some larger insurance companies have when dragged into court. In the court case brought up by Christina Phillips – and one that happened to be headed by the Merlin Law Group – Todd McGee, the plaintiff, filed a complaint against State Farm Fire and Casualty Company after dealing with some typical bad faith actions.
The court recognized the obviousness of these actions as Phillips brings out saying:
The court in McGee concluded that the insured’s amended complaint was sufficient to state a cause of action where it alleged that the insurer had performed an inadequate investigation; refused to negotiate the claim in good faith; delayed the appraisal process by failing to agree upon an umpire; and delayed payment after completion of the appraisal process.
That’s a mouthful.
Fortunately for Todd McGee, he was able to obtain a payout for the appraisal done on his damaged house.
After the payout was given, State Farm Fire and Casualty assumed that would be the end of it, but the claim involved something called section 155 or as it is better known, “Vexatious and Unreasonable Conduct.”
What is section 155?
It’s part of an insurance code in Illinois that specifically deal with bad faith actions done by insurance companies.
Miss Phillips believes that the case will set a precedent that will allow their “client’s section 155 claim to stand.” We can only hope that it does as the insurance world could use more legal precedents that deter bad faith actions.
What do you think? Will this become a legal precedent and, in the long run, be beneficial for policy holders?–