Workers Comp & Bad Faith Claims: Understanding the Financial Facts
America was built on the backs of hard working individuals, but sadly, these workers had little rights throughout most of U.S. history. Luckily, that all changed over the past century with new labor laws. One of the most important legal evolutions was that of worker’s compensation. This insurance ensured that injured workers didn’t lose all financial support right when they needed it the most, but some insurance companies make life difficult for these workers through bad faith practices. This is why anyone injured on the job should understand bad faith and how to address it.
Who is Eligible for Worker’s Compensation?
Most injured workers throughout America are eligible for worker’s compensation if their employer meets certain criteria. Unfortunately, worker’s comp laws vary by state, so there are no definite rules that apply everywhere. In most cases, however, workers are entitled to these benefits if they’re injured while performing some duty related to their job. These benefits are paid regardless of who was at fault for the injury, and this reduces the amount of litigation related to employee injuries.
It should be noted, though, that there are times when a worker may not be eligible for benefits. If the employee wasn’t at work or was under the influence of any intoxicating substance, for instance, insurers can legitimately deny a claim.
What are Bad Faith Practices?
All insurance companies, including worker’s comp insurers, automatically owe a duty of good faith in their dealings with claimants. This means that they’re required, by law, to act honestly and provide benefits for those who legitimately deserve them. Sadly, with the economy still slowly recovering, these companies are more focused on increasing their profit margins, and this often leads them to treat individuals unfairly in an attempt to avoid large payouts.
An insurer who purposefully delays or denies a legitimate claim is guilty of bad faith practices. One example of this occurred in 2010 when a jury awarded a flight attendant nearly $1.8 million for the bad faith practices of American International Group, also known as AIG/Chartis, which resulted in the individual not receiving compensation for nearly seven years. AIG insurance workers compensation claims are no stranger to bad faith lawsuits, and in this case, they were caught red handed by the jury engaged in dishonest practices.
Fighting against Bad Faith
The first step to fighting bad faith practices on the part of an insurer is recognizing them. If it seems as if an insurer is purposefully delaying, unfairly denying or even underpaying a legitimate worker’s compensation claim, there’s a good chance that the insurer may just be trying to save money to the detriment of the injured individual. In these cases, it’s essential to hire an attorney.
The great part about having a legal professional take on the case is that the insurer, if found to have acted in bad faith, will have to pay out much more than they otherwise would’ve if they’d acted fairly in the first place. Studies have shown that the existence of bad faith laws cause insurers to offer fair settlements the first time around, but when this doesn’t happen, having an attorney at one’s side is imperative.
Most Americans understand how important it is to work hard for a living, but a single injury can quickly make this next to impossible. Even with laws that now protect workers, insurers may still try to delay, underpay or even deny legitimate claims. Luckily, there are legal remedies to these illegal actions, and any worker who thinks they’re being treated unfairly should immediately speak with an attorney. Considering the potential for a much larger settlement, the hassles may all turn out to be worth it in the end.
Lisa Coleman shares what bad faith practice is and how it can be fought with legal help. She recently read online about AIG insurance workers compensation claims and their bad faith practices, and how retaining experienced legal help is a must for such circumstances.
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Category: Business
