Insurance is supposed to provide security when life goes wrong. Texans pay premiums with the expectation that their insurer will investigate claims fairly and pay what the policy promises. When an insurance company refuses to honor those obligations, its conduct may amount to bad faith.
This article explains what a bad faith claim is under Texas law. It also describes what types of insurer conduct can give rise to bad faith, steps you can take to protect yourself, and how a personal injury lawyer can help.
What Is a Bad Faith Claim?
A bad-faith claim arises when an insurance company fails to deal fairly and honestly with a policyholder or claimant.
Texas law requires insurers to:
- Conduct reasonable investigations
- Evaluate claims objectively
- Communicate promptly and truthfully
- Pay benefits owed under the policy
When an insurer violates these duties and causes harm, the policyholder may pursue compensation beyond the original claim amount.
Bad faith is more than a simple disagreement over value. It involves conduct that is unreasonable, deceptive, or intentionally obstructive.
Types of Insurer Conduct That Can Give Rise to Bad Faith
Insurance misconduct can take many forms.
Common examples include:
Unreasonable Denial of a Valid Claim
Insurers who ignore clear medical evidence, misinterpret policy language, or refuse to pay without a legitimate reason.
Failure to Investigate Properly
Insurance companies that rush to deny without reviewing records, ignore witness statements, or fail to inspect damaged property.
Unreasonable Delay
Insurers who drag out decisions for months, repeatedly request the same documents, or fail to respond to communications.
Lowball Settlement Offers
Insurers who offer far less than the claim is worth, pressure for quick acceptance, or refuse to explain how the value was calculated.
Misrepresentation
Insurance companies that tell you coverage does not exist when it does, provide false reasons for denial, or change explanations over time.
Violating Prompt Payment Rules
Texas law sets timelines for acknowledging, investigating, and paying claims. Missing these deadlines can support a bad-faith action.
What Can You Do to Protect Yourself?
If you suspect an insurer is acting unfairly, certain steps can strengthen your position.
Remember to:
- Keep Detailed Records. Save all letters, emails, and texts. Make sure to note the date of all phone calls. Keep claim numbers and adjuster names.
- Document Your Losses. Maintain medical bills and receipts. Take photos of property damage. Track your time missed from work.
- Follow Policy Requirements. Report your claim promptly. Cooperate with all reasonable requests. Avoid giving recorded statements without seeking legal advice.
- Do Not Accept Unfair Offers. Once you sign a release, you usually cannot reopen the claim. Take time to understand the true value before agreeing.
- Seek Legal Guidance Early. An attorney can evaluate whether the insurer’s conduct crosses the line into bad faith. Your lawyer can communicate and negotiate on your behalf.
Taking these proactive steps can help protect your rights and put you in a stronger position if you need to challenge an insurance company’s unfair tactics.
What Damages Are Available in a Texas Bad-Faith Claim
When bad faith is proven, Texas law may allow recovery of more than the original policy benefits.
Potential damages include:
- The amount wrongfully denied
- Financial losses caused by the delay
- Mental anguish in some cases
- Statutory penalties and interest
- Attorney’s fees
- In extreme cases, punitive damages
These remedies exist to discourage abusive insurance practices.
Bad Faith in Personal Injury Cases
Bad faith often arises alongside personal injury claims.
For example:
- An auto insurer refuses to pay medical bills
- A liability carrier ignores clear evidence of liability
- An underinsured motorist carrier undervalues injuries
In these situations, the fight is not only about the accident but also about the insurer’s handling of the claim.
Challenges in Proving Bad Faith
Insurance companies defend these cases aggressively. These companies have teams of lawyers working to minimize payments and defend the company.
They often argue:
- The claim was fairly debatable
- More investigation was needed
- Disputes over value were reasonable
Proving bad faith requires careful review of claim files, communications, and internal insurer decisions. A skilled attorney can help you sort through the complexities and pursue fair compensation.
How a Personal Injury Lawyer Can Help
Handling a bad-faith dispute alone is difficult.
A personal injury lawyer can:
- Review your policy and claim history
- Request the insurer’s claim file
- Identify violations of Texas law
- Calculate the full scope of damages
- Negotiate with the insurer
- File a lawsuit if necessary
If you feel like your insurance company is giving you the runaround, don’t let yourself be bullied. Turn to a trusted legal advocate to challenge unfair insurance practices and pursue the compensation you deserve.
Why Timing Matters
Bad-faith claims are subject to legal deadlines. Waiting too long can limit your options. Early legal involvement also helps prevent further insurer misconduct and preserves evidence.
You don’t have to wait to seek legal guidance when an insurer is treating you unfairly. In fact, waiting too long can hurt the integrity of your case.
Contact a Dallas Bad Faith Insurance Lawyer at Benton Accident & Injury Lawyers for a Free Consultation
Insurance should provide peace of mind. Your insurer isn’t supposed to create additional challenges after an accident. When an insurance company denies valid claims, delays payment, or misleads policyholders, Texas law offers a path to justice through bad-faith claims.
Contact Benton Accident & Injury Lawyers today at (214) 556-8321 to schedule a free case review with a Dallas bad faith insurance lawyer. With experienced legal help, Texans can stand up to powerful insurance companies and demand the fair treatment they paid for.
Visit Our Personal Injury Law Firm in Dallas, TX
Benton Accident & Injury Lawyers
1825 Market Center Blvd # 350, Dallas, TX 75207
(214) 556-8321
Open 24/7
