Cheyenne, WY, Bad Faith Insurance

Bad Faith Insurance

You have rights under Wyoming law when an insurer does not live up to its end of the insurance policy. In many situations, you do not even need to experience a breach of the agreement. You can pursue a claim simply because of the insurance company’s claim processing practices.

Wyoming’s Unfair Trade Practices Act sets out many of the prohibited practices that can form the basis for a bad faith lawsuit, including the following:

• Denying a claim without investigating it
• Failing to acknowledge and act reasonably promptly on communications
• Unreasonably delaying a decision to accept or deny coverage after a claim
• Failing to explain the basis for claim denials or compromise settlements
• Refusing to promptly pay proven claims to pressure someone to settle disputed claims

The key provision in the act requires insurers to make a good faith attempt to enter into a “prompt, fair, and equitable” settlement when liability has become reasonably clear. Thus, a bad faith insurance claim does not necessarily require proof of “bad faith.” Instead, it often means the insurer fails to show good faith in its claim processing.

How a Bad Faith Insurance Lawyer Proves Bad Faith Claims

Insurance companies in Wyoming have financial reasons to pay as few claims as possible. When they do pay, their goal is to spend as little as possible. Thus, insurers will deny or reduce claims whenever they think they can get away with it.

This strategy has two benefits for insurers. First, claimants will sometimes accept the insurer’s decision to deny or reduce the claim rather than fighting it. Second, the insurer may drag the process out long enough that the claimant gives up or settles out of frustration. In either case, the insurance company has accomplished its goal.

However, under Wyoming’s insurance laws, the insurer has a duty of good faith toward claimants. Proving a bad faith claim may require evidence such as:

• Testimony from expert witnesses in the insurance industry
• Internal documents teaching or endorsing prohibited practices
• Whistleblower testimony from insurance company employees
• Communications between you and the insurance company

In many cases, your Cheyenne bad faith insurance attorney can simply point to the insurer’s practices and allow the jury to exercise its judgment in deciding whether the insurer acted reasonably.

Compensation Recoverable In A Bad Faith Insurance Claim

Insurance companies are regulated, and you can always file a complaint. But this does not necessarily get your claim paid. To get compensation, you must file a bad faith lawsuit. 

Bad faith claims do not replace your original insurance claim. Instead, they get added to the original claim due to the harm caused to you by the insurance company’s unfair practices.

For instance, suppose that the insurer denied your homeowner’s claim even though its $100,000 liability was clear. When your attorney files a bad faith lawsuit, they will include a claim for the $100,000 the insurer should have paid. 

In addition to that $100,000, your attorney will include the losses you incurred due to the insurer’s actions. These losses can be both economic and non-economic in nature, and your specific losses will depend on the circumstances of your case.

Economic losses encompass the financial costs of the insurance company’s actions. For a car accident claim, maybe you had to rent a car during the insurance company’s unreasonable delay. Alternatively, after a house fire, the insurer’s actions might have resulted in extra cleanup costs due to damage that could not be fixed without payment.

Non-economic losses are the ways the insurer harmed your quality of life. A wrongful denial of a health or auto insurance claim may cause physical pain. An insurer’s unreasonable delay of a home insurance claim could rob you of your independence by forcing you to live with relatives in a different town.

Finally, a judge or jury might award punitive damages in bad faith insurance claims. Punitive damages punish egregious conduct, such as lying to claimants or altering documents. They also deter others from engaging in the same practices.

How A Bad Faith Insurance Lawyer Helps You

Bachus & Schanker has the resources and determination to fight billion-dollar insurance companies. Since founding the firm, we have recovered over $1 billion in compensation for our personal injury and bad faith insurance clients.

When you hire our Cheyenne law firm, we provide the following services:

• Discuss your situation and review documents to identify possible claims
• Gather evidence to support your case
• Notify the insurer of your rights and try to settle
• If the policy includes an arbitration clause, prepare for arbitration
• Draft and file a lawsuit against the insurer if arbitration fails
• File motions and prepare for trial while continuing settlement talks
• Present your case at trial if it does not settle

Most cases settle before reaching trial. However, we use our decades of litigation experience to thoroughly prepare every case. This preparation puts us in a strong position to negotiate a settlement or try your case.

Contact Us Today

We understand the pain and distress you experience when insurers fail to do their jobs. You suffered a loss from the original covered event. Then, you suffered another loss when the insurer mishandled your insurance claim. 

Sources: 

Consumer Information.

Insurance Consumer Rights in the State of Wyoming (2022).

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