In Washington, an insurance company owes the insured (or “policyholder”) a duty of good faith and fair dealing. If an insurance company violates these duties when dealing with a claim of the insured person, the insured person may sue the company for breach of the duties in addition to a standard breach of the insurance contract. The result is that a plaintiff in an insurance bad faith case may be able to recover an amount of damages greater than the original face value of the policy if the insurance company’s conduct was particularly egregious.
Bad faith can occur when an insurer improperly refuses to defend a lawsuit, or when an insurer improperly refuses to pay a judgment or settlement of a covered lawsuit.
Attorney at Law
Blado Kiger Bolan, Tacoma, Wash.