In Ohio, the insurance company can be made to pay damages for bad faith if they act “without reasonable justification” in denying a claim for either an uninsured (UM) or an underinsured motorist (UIM) claim.
This is because your own company owes you a special duty of trust. Why? Because you bought the insurance from them, and because no one really has the time or the knowledge to compare companies and adjusting practices; so the law says you are entitled to more respect in their handling of your claim than if a driver that same company insured had hit you.
What does this mean? It means that if you file a claim against your UM or UIM insurer, and they don’t have a reasonable basis for failing to offer you a fair amount, or failing to investigate the claim, you can get a judgment against them for (1) the consequential damages you incurred because they wouldn’t pay you what and when they should have (2) your attorney fees and litigation expenses (maybe) and (3) punitive damages (maybe).
What are consequential damages? They are damages you incurred because the insurance company didn’t pay you the money it was supposed to when it was supposed to.
For instance: the UM insurer doesn’t pay you enough money to take care of your medical expenses. You don’t have any other insurance and you have no money to pay for the medical care. As a result, your condition worsens, you don’t get the needed treatment, and the failure to get timely medical care results in your needing additional medical care.
The extra medical bills, and the extra pain and suffering and lost wages caused by your inability to get treatment when you initially needed it would arguably be consequential damages.
When can you get attorney fees and punitive damages? The actions on the part of the insurance company must amount to “actual malice”; which means “a conscious disregard for the rights and safety of another person that has a great probability of causing substantial harm”.
In plain English, here it is: in Ohio, if you prove bad faith, there is a good chance you will also get the attorney fees and punitive damages. The worse the actions are on the part of the insurance company, the more likely it is you will get the attorney fees and the punitive damages.
What does the insurance company have to do to be liable in bad faith on a um/uim lawsuit? Here are some examples:
– Fail to timely investigate the claim. Make an offer that is obviously too low.
– Require you to jump through “hoops” not required by the policy.
– Tell you coverage is excluded for your case when it is not.
The list is long. I settled a case where the insurance company had sold my client a um/uim policy that was obviously insufficient to cover the client’s damages, and then failed to advise the client of that fact.
In fairness to the insurance companies, the courts have held that it is not “bad faith” to deny a claim; the company just has to show a “reasonable justification” why it did what it did.
Which brings us back to the question. How do you make the insurance company play fair? Have your lawyer threaten the company with a bad faith lawsuit – if the threat is justified.
I have been a lawyer over 30 years. I have filed law suits seeking damages for bad faith, and have given lectures to other lawyers on bad faith. If you have a personal injury case in Cincinnati, Ohio or if you want to know what your lawsuit is worth, talk with an experienced Cincinnati injury lawyer> about the case. Call me, William Strubbe, at 513-621-4775.
Because all situations are different, and because there may be other facts pertaining to your case that I don’t know about, you should not rely on this answer for legal advice. I am not your attorney, and no lawyer client relationship has been formed.