When an insurance company wrongly fails to pay what is owed to a worker hurt on the job, the injured worker may be entitled to additional compensation. This conduct is often referred to as “bad faith.”
The law recognizes that when a worker is hurt, the worker will often experience financial hardship. If insurance companies could refuse to pay what they owe when they owe it, they would unfairly benefit at the expense of workers. To hold insurance companies accountable, the law provides a “penalty” when insurance companies won’t pay what they owe when they owe it, for no good reason.
How Much Can Be Recovered in a Bad Faith Claim?
If you believe that you are not being paid what you are owed, of if the insurance company is unreasonably delaying or denying your claim, you may be entitled to additional compensation if the insurance company acted in bad faith. If the Industrial Commission finds that bad faith or unfair claims processing has occurred, the Commission must award the injured worker a penalty of 25% of the benefits it finds are owing or $500, whichever is more.
What Constitutes Bad Faith?
Situations involving bad faith or unfair claims processing most often involve one or more of the following situations:
- Unreasonably failing to respond promptly to letters or phone calls
- Unreasonably delaying payment of compensation
- Unreasonably underpaying compensation
- Unreasonably terminating benefits
- Unreasonably interfering with an injured worker’s right to choose his or her attending physician
- Unreasonably delaying authorization for medical treatment
How Are Bad Faith Complaints Started?
Bad faith complaints are initiated by filing a written complaint with the Industrial Commission. In our experience, virtually all such complaints are denied. However, if this happens, the injured worker can request a hearing before an administrative law judge, at which time he can introduce evidence to try to persuade the judge to award a bad faith penalty.
Can I Sue in Superior Court?
Injured workers can also sue insurance carriers for bad faith in Superior Court. The advantage of suing in Superior Court is that the recovery can be substantial. The disadvantage is that Superior Court litigation can be time-consuming and expensive.
We Help Injured Workers Who Have Had Payments Wrongfully Denied
If you believe that you have had workers’ compensation payments wrongfully denied, we may be able to help. Please give us a call today so that we can learn about your case and determine if pursuing a bad faith claim makes sense.