Insurance bad faith claims occur when an insurance company fails to fulfill its obligations to policyholders, acting unfairly or deceptively in handling claims. For instance, denying legitimate claims, delaying payments unreasonably, or offering low settlements in bad faith can harm policyholders.
These claims play a crucial role in safeguarding policyholders’ rights, ensuring that insurance companies uphold their end of the bargain. By holding insurers accountable for their actions, policyholders can seek justice and fair treatment in the event of a claim.