Insurance companies have a legal obligation to act in good faith when dealing with their policyholders. This means that they must treat their customers fairly and honestly, and not try to avoid paying valid claims or delay the process unnecessarily.
However, sometimes insurance companies fail to meet this standard and engage in wrongful conduct that harms their customers, known as insurance bad faith.
Insurance bad faith
Insurance bad faith can take many forms, but one of the most common and serious examples is when an insurance company denies or delays needed medical care for its policyholder.
This can have devastating consequences for the health and well-being of the insured person, who may suffer from pain, disability or even death as a result of the lack of proper treatment.
In Oklahoma, insurance bad faith is not only a breach of contract, but also a tort that can give rise to a separate lawsuit against the insurance company. The policyholder can seek compensation for the damage caused by the insurer’s bad faith, such as medical bills, lost wages, emotional distress and punitive damages.
Additionally, the policyholder can also recover attorney fees and costs incurred in pursuing the claim.
Prove insurance bad faith in Oklahoma
To prove insurance bad faith in Oklahoma, the policyholder must show that the insurance company had a duty to act in good faith and deal fairly with the policyholder, or the insurance company breached that duty by acting unreasonably or dishonestly.
It also must be shown that the policyholder suffered damage as a result of the breach, and the insurance company’s breach was the direct and proximate cause of damage.
Malice or ill will
The policyholder does not have to show that the insurance company acted with malice or ill will, but only that it acted without a reasonable basis or justification for its conduct. One of the key issues in insurance bad faith cases involving medical care is whether the insurance company had a reasonable basis for denying or delaying the treatment.
This may depend on factors such as the terms and conditions of the policy, the medical necessity and appropriateness of the treatment and the availability and cost of alternative treatments.
It also depends on the opinions and recommendations of medical experts, and the evidence and documentation submitted by the policyholder.
Denies or delays medical care
If the insurance company denies or delays medical care without a reasonable basis, it may be liable for bad faith. However, if the insurance company has a legitimate dispute or disagreement over the coverage or the treatment, it may not be liable for bad faith as long as it acts reasonably and in good faith.