With the high costs of medical care and treatment, having a health insurance claim denied can be devastating for insureds. When that health insurance claim is denied in bad faith, it can be even worse. For that reason, insureds should be familiar with what they can do about a denied health insurance claim.
What to do when a health insurance claim is denied in bad faith
Because insurance policies are a form of contract, one option is a claim based on violation of that contract. Parties to a contract owe one another the duty to act in good faith. When they violate that duty, or an obligation under the contract, there may be a claim for breach of contract.
Examples of bad faith in dealing with the insured that may lead to a breach of contract claim against the insurer can include:
- If the insurer fabricated evidence;
- If the insurer refuses to accept evidence;
- If the insurer refuses to conduct an investigation into the claim;
- If the insurer unreasonably delays an investigation into the claim;
- If the insurer unreasonably adheres to minor procedural or bureaucratic requirements to the detriment of the insured; and
- In other situations that demonstrate that the insurer has behaved unfairly towards the insured.
Dealing with health insurance claim denial
There are a variety of excuses that insurers may offer for a claim denial but when a health insurance claim is wrongfully denied by the insurer, that is an example of the insurer acting in bad faith. Anyone who carries an insurance policy knows that it is there to help in the most difficult of times usually physically, financially and emotionally. When an insurer makes a bad faith denial of a claim, insureds who have faithfully paid on their policy in anticipation of the day they might need it, should know what they can do about it, including a breath of contract claim that may help with their damages.