Insurance Bad Faith:
People purchase insurance to guard against economic losses arising from personal injuries or property damages, or the possibility of a lawsuit that will result in losses. In exchange for paying premiums, a policyholder is owed various duties by the insurer. All insurance companies also owe an implied duty of good faith or fair dealing.
Unfortunately, there are cases in which an insurer fails to uphold its implied duties to the insured. In order to guard their profits, insurers sometimes commit deceptive practices, deliberately misinterpret their own policy language or records to avoid paying a claim. These breach the implied duty of good faith and fair dealing, and they may give rise to a bad faith lawsuit.