Update: February 4, 2019 In March 2018 a state court in Washington allowed bad-faith suits against insurer employees. In a recent report by some members of The Coalition Against Insurance Fraud have expressed concern that this ruling will cause a chilling effect to fraud fighting by discouraging insurers and their employees from thoroughly investigating suspicious claims and sending referrals to law enforcement for prosecution.
Often bad faith claims are filed when an insurance company wrongfully denies a claim without a reasonable basis for that denial. The case at hand is out of Washington, facts and details are in the original article. No other state extends bad faith to individual insurance employees to the degree found in Keodalah. The Keodalah court found that investigators and other insurance personnel involved in a claim can be personally sued, when a claims adjuster in a crash-injury case was held personally liable for bad faith and forced to pay treble damages and attorney fees.
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