After waiting almost a year for the insurance company to settle a routine car crash claim, a Louisiana man asked a state District Judge to intervene in the matter. Victims in Lafayette and Lake Charles who are still waiting on insurance companies to pay, and are forced to contemplate bad faith actions, can certainly sympathize with him.
In court documents, Patrick Constantine says that the other driver was clearly negligent in an August 2015 collision, and neither Geico nor United Services Automobile Association (USAA) have compensated him for his damages.
The lawsuit is pending in Division I Judge Piper Griffin’s Orleans Parish courthouse.
Bad Faith Cases
This dispute comes to court a little over a year after the Louisiana Supreme Court decided Kelly v. State Farm, one of the most significant bad faith insurance opinions in recent memory. Danny Kelly accrued over $26,000 in medical bills alone following a 2005 car crash; although the lone eyewitness said that Henry Thomas failed to yield the right of way, the insurance company still refused to pay the claim. Mr. Kelly offered to settle the claim for $25,000 (the policy maximum), and State Farm ignored the letter. The case went to trial, Mr. Kelly obtained a $176,000 judgment, and per an agreement between the parties, he then filed a bad faith action against State Farm to obtain payment on the judgment.
State Farm tried to argue that it had no duty to pay the claim, because Mr. Kelly’s letter did not constitute a “settlement offer” due to a technicality and it had no duty to inform its insured about the seriousness of the situation.
The court ruled in favor of Mr. Kelly on both grounds. An insurance company has a prima facie duty to promptly settle undisputed claims, regardless of what the victim does or does not do. In most cases, the court added, a tortfeasor’s (negligent driver’s) self-serving statements do not constitute a legitimate dispute. The court also broadly interpreted La. R.S. 22:1973(B)(1) to include any misrepresentation of “pertinent facts,” whether or not that misrepresentation dealt with policy coverage.
To win a bad faith insurance claim in Louisiana, the plaintiff must prove that the insurance company was “vexatious,” which essentially means that the insurance company intentionally dragged its feet and did what it could to make life difficult for the plaintiff. Kelly makes it much easier for plaintiffs to meet this burden in court.
To maximize their profits, insurance companies will do almost anything to deny fair compensation to victims. For prompt assistance from an assertive Lake Charles personal injury attorney, contact Hoffoss Devall today, because you have a limited amount of time to act.