BAD FAITH DENIAL
Question: "What is "bad faith" and how do I fight it?"
Hello, - if you are experiencing a bad faith problem, let us know, we can help. Just call Vince Bagni, or Morgan Moran at (800) 554-9142. For those of you who are not sure what bad faith means, or if you are not sure you are a victim, here are the details
"A bad faith claim says that the "insurance company acted unreasonably". All insurance policies require that the insurance company act in good faith when reviewing a claim. If the insurance company did not perform an adequate investigation, or "attempted to settle your claim for less than what it’s worth", you may have a viable bad faith claim and you can recover your benefits. If you can establish a bad faith claim, you may be awarded for "infliction of emotional distress and fraud" and receive compensation for punitive or exemplary damages, which can exceed the actual amount owed under the contract."
Usually in bad faith claims, the courts will not just look at the legal rights of parties in pursuing a transaction or a lawsuit, but will look behind the activity at the motives of the persons attempting to obtain the assistance of the court. If a court feels that the reasons behind the transaction are deceitful and duplicitous, then the judge will rule against the deceitful party.
Simply put, bad faith denials occur when an insurance company denies or delays paying a legitimate claim for no fathomable reason. Thus, the insurance company may be acting in bad faith. In such cases it may be liable not only for the claim itself, but for punitive damages.
Following is an examples of bad faith claims:
In a class action law suit against an insurance company, several cancer patients claimed that, by paying for only one of the drugs used in a chemotherapy cocktail, insurer interpreted policy too narrowly.
Common issues and topics related to Bad Faith Denials include:
If you or anyone you know is in need of an attorney focusing on bad faith denials, please contact us now.
"MEGA Life and Health Insurance Company is an insurance company that sells health insurance in 47 states. They sell a lot of policies here in California, as well. MEGA Life’s sister company, Midwest National Life Insurance Company of Tennessee, also sells policies in 47 states, including California. They are owned by an insurance holding company called Health Market, a Texas entity that used to be called UICI and was a Texas holding company on the New York Stock Exchange. In the last year, UICI was sold to a private equity company, and is no longer a public company. They continue to hold and own MEGA, as well as Midwest, but have changed their name to Health Markets."
How are they selling their health insurance product?
"Primarily, they sell through a group of agents who sell the policies and memberships through two organizations: one called NASE, (National Association of Self-Employed) and another called Alliance for Affordable Services. The agents advise insurance consumers that if they join either the NASE or the Alliance for Affordable Services, they are joining large groups of insurance consumers and can obtain group-like insurance at group-like premiums. They never advise the potential insureds that these so-called not-for-profit entities are actually controlled by health markets and their subsidiaries, MEGA and Mid-Life, Midwest."
Is it legal to sell health insurance this way?
"It is legal. However, in California and several other states, a group like this cannot be set up for the sole purpose of selling insurance, and we take the position that these organizations were set up specifically to sell insurance, which is illegal."
Is this considered insurance fraud?
"In our opinion, yes."
Is there anything else we should know about MEGA Life?
"MEGA Life and their sister company, Midwest, continue to sell these products after settling a multi-million dollar class action settlement whereby they were ordered to advise of the inner relationships between the holding company, these groups, and the insurance companies, so that people would really understand that these groups are not really independent, that they don’t necessarily have the consumers’ best interests at heart, and that the insurance companies are pulling off a fraud on these insurance consumers."
Are they continuing to market this way after that settlement?