Lawyers from a respected Alabama law firm are currently investigating discount insurance provider Geico for claims that the company improperly charged its car insurance policy holders multiple deductibles. According to claims made under Geico's auto collision policy provisions, "Losses arising out of a single occurrence shall be subject to no more than one deductible." According to allegations made by several policy holders, however, Geico is not holding true to the written policy's standard.
The instances in which this fraudulent practice is reportedly occurring are somewhat unusual. For example, if one family member hits another relative's car, and both cars are covered under the same policy, Geico has allegedly been charging the policy holder two deductible fees, despite the fact that the damage resulted from a single occurrence. If proven to be true, these allegations show that Geico is clearly violating the tenets of agreement reached with its insurance policy holders.
When an insurance company clearly violates the terms of a first-party insurance policy, as Geico has allegedly done, the policy holder may bring a bad faith claim against the provider. Under the law, insurance providers owe their policy holders a duty of "good faith" and "fair dealing;" when they fail to meet their responsibilities, they may be held liable, sometimes for greater amounts than those originally provided for in the insurance policy.
Any of the following behaviors may be considered bad faith on the part of an insurance provider:
- Misrepresenting facts related to a policy
- Violating terms of a policy
- Failing to make prompt and/or fair payments after liability has been established
- Failing to reasonably explain claim denials
- Failing to affirm or deny claim coverage within a legally mandated time period
- Attempting to dismiss a claim that has only been partially paid
- Refusing to pay a claim without reasonably investigating the matter
- Delaying a claim because of a policy holder's additional coverage
- Requiring a claimant to provide income tax returns as a condition of settlement without a court order, except when the claim involves a fire loss, lost profits or lost income
If you are a Geico policy holder whose policy terms have been violated, or if your first-party insurance provider has acted in bad faith in any claim, you may be entitled to compensation. Contact the first party insurance attorneys at Arnold & Itkin today for a free consultation regarding your case.