Bad Faith Insurance: What to Do If Your Claim Is Denied

Understanding Bad Faith Insurance Practices

When you file an insurance claim, you expect your insurer to act in good faith—investigating your case promptly, processing your claim fairly, and paying out what is owed under your policy. Unfortunately, some insurance companies engage in “bad faith” practices, unlawfully denying or delaying claims to avoid financial responsibility.

Signs Your Insurance Company May Be Acting in Bad Faith

Bad faith insurance practices are not always obvious. If you’ve encountered any of the following issues, your insurer may be violating the law:

• Unreasonable Delays: If the insurer takes an excessively long time to process your claim without justification, it could be a bad faith tactic (Missouri Revised Statutes, Chapter 375.1007).
• Lack of Communication: If your insurer ignores phone calls, emails, or written correspondence regarding your claim, this is a red flag.
• Denying a Claim Without Explanation: Insurance companies are required to provide clear reasons for denying a claim. If they refuse without a legitimate basis, it may constitute bad faith.
• Lowball Offers: Some insurers intentionally offer settlements far below the actual damages to pressure claimants into accepting less than they deserve.
• Misrepresenting Policy Terms: If an insurer deliberately misinterprets policy language to justify a denial, they may be acting in bad faith.

What to Do If Your Claim Is Denied

If your insurance claim has been wrongfully denied, here’s what you can do to fight back:

1. Review Your Policy in Detail

Start by carefully reviewing your insurance policy to understand your coverage, exclusions, and the reasons stated for denial. Insurers often rely on complex language to discourage policyholders from challenging their decisions.

2. Request a Written Explanation for the Denial

Under Missouri law, insurance companies must provide a written explanation of their decision. If your insurer has not provided one, request it in writing immediately (Missouri Revised Statutes, Section 375.1005).

3. Gather Evidence to Support Your Claim

Collect documentation such as:

• Photos and videos of the damage
• Repair estimates
• Medical records (if applicable)
• Any communication with the insurance company
• Witness statements

4. File a Complaint with the Missouri Department of Insurance

If you suspect bad faith, you can file a complaint with the Missouri Department of Insurance. They investigate unfair insurance practices and can take action against insurers who violate the law.

5. Hire a Bad Faith Insurance Attorney

If the insurance company refuses to pay your claim despite overwhelming evidence, it may be time to seek legal representation. An experienced St. Louis insurance dispute lawyer can help you file a lawsuit for damages, including:

• The amount of the denied claim
• Legal fees and court costs
• Additional penalties for bad faith conduct