How Do I Know If My Insurance Company Is Acting in Bad Faith?

Here in Oklahoma, we’ve watched countless hardworking folks struggle with insurance companies that seem more interested in protecting their bottom line than honoring their promises. These aren’t just annoying customer service issues – they might actually be examples of insurance companies acting in bad faith.

But what exactly crosses that line from frustrating to illegal? Let’s dig into how you can spot when your insurance company might be breaking the rules.

When Insurance Companies Break Their Promises

Remember that insurance card you keep in your wallet? That represents a contract. You’ve held up your end by paying premiums. In return, your insurer promises to have your back when things go wrong.

Oklahoma law doesn’t just suggest insurance companies should play fair – it demands it. Every insurance policy in our state carries an implied covenant of good faith and fair dealing. Fancy legal talk aside, this simply means your insurer must treat you honestly and fairly.

When your insurance company unreasonably denies your claim, drags their feet for months, or offers pennies on the dollar for valid claims, they’re not just being difficult. They’re potentially breaking the law.

Looking at Oklahoma’s Unfair Claims Settlement Practices Act (36 O.S. § 1250.5), we can see clear rules about how insurance companies must handle claims. The problem? Many insurance companies count on you not knowing these rules.

10 Red Flags Your Insurer May Be Acting in Bad Faith

Through our years representing Oklahomans fighting bad faith insurance practices, we’ve spotted patterns in how insurance companies try to dodge their responsibilities. Here are ten warning signs your insurance company might be crossing the line:

1. They’re Playing the Waiting Game

Have you been waiting… and waiting… and waiting to hear back about your claim? Insurance companies in Oklahoma must acknowledge and act on communications about claims within reasonable timeframes – usually 45 days to settle once they’ve been notified. When they drag the process out without explanation, they’re often hoping you’ll simply give up.

We recently helped a client who’d been waiting over six months for his homeowner’s insurance to process a simple claim. Each time he called, they promised “just two more weeks.” That’s not a communication issue – that’s a strategy.

2. They Deny Without Investigating

Has your claim been denied without anyone really looking into what happened? A proper investigation isn’t optional – it’s required. If your insurance adjuster seems to have made up their mind before examining the facts, your insurer may be acting in bad faith.

3. They Offer Peanuts for Your Claim

We often hear about ridiculously low settlement offers that wouldn’t begin to cover damages. When an adjuster offers a settlement that’s dramatically lower than what your claim is worth, they’re betting you’ll be desperate enough to take whatever they offer.

4. They Twist Policy Language Like a Pretzel

“Well, technically, water damage from above isn’t covered, only water damage from below.” Sound familiar? Some insurance companies intentionally misinterpret policy language in ways that defy common sense. If you’re hearing interpretations of your policy that seem absurdly narrow or contradict what your agent told you when you signed up, your alarm bells should be ringing.

5. They Bury You in Paperwork Requests

While insurers naturally need documentation to support your claim, there’s a point where repeated requests cross into delay tactics. If you’ve already provided reasonable proof and they keep demanding more obscure documents without explaining why, they might be hoping you’ll just throw up your hands and walk away.

6. They Won’t Tell You Why They’re Denying Your Claim

Oklahoma law requires insurance companies to explain why they’re denying a claim. Vague references to “policy exclusions” without specifics aren’t good enough. You have the right to know exactly which provision they’re relying on to deny coverage.

7. They Use Bullying Tactics

Has an insurance adjuster ever made you feel threatened or intimidated? Told you that “this offer expires today” or implied you’d get nothing if you hire an attorney? These pressure tactics often indicate an insurer acting in bad faith.

8. They Ghost You

When your insurance company consistently fails to return calls or respond to emails about your claim, they’re not just being rude. They’re employing a strategy to wear you down through frustration. Professional insurers don’t vanish when you need answers.

9. They Create Impossible Hoops to Jump Through

If your insurer demands in-person meetings at inconvenient locations, sets unrealistic deadlines, or requires excessive steps to process your claim, these unreasonable demands could indicate bad faith practices designed to make you give up.

10. They Refuse to Pay Even When Liability Is Clear

Perhaps the most obvious sign of bad faith is when your insurance company refuses to pay a valid claim even after all requirements have been met and liability is clear. This direct violation of the insurance contract is exactly what Oklahoma’s bad faith laws were designed to address.

Different Types of Bad Faith Claims in Oklahoma

Not all bad faith claims work the same way. We generally see two main categories in our practice:

First-Party Bad Faith Claims

These happen when your own insurance company fails to handle your claim properly. Maybe your health insurer denied a covered treatment, your homeowner’s policy refused to pay for storm damage, or your auto insurance is dragging its feet after an accident. These situations involve direct breaches of your insurance contract.

The “Badillo Scenario” in Oklahoma

While Oklahoma doesn’t recognize traditional third-party bad faith claims, the Badillo v. Mid-Century Insurance Company case established an important legal precedent. When an insurance company unreasonably denies a claim against their policyholder, resulting in a judgment exceeding policy limits, the policyholder can sue their own insurer for first-party bad faith.

In practice, this creates a roundabout path to justice: the at-fault party (whose insurer acted improperly) sues their own insurance company, recovers damages, and then uses that money to pay the injured person. Insurance companies must place themselves in their insured’s shoes when evaluating claims and cannot unreasonably expose policyholders to out-of-pocket damages simply to protect the company’s bottom line.

What Should You Do If You Suspect Bad Faith?

If you’re beginning to suspect your insurance company is playing dirty, don’t just stew about it. Take action:

1. Document absolutely everything. Every call, email, letter – note the date, time, who you spoke with, and what was said. This paper trail can be gold if you need to prove bad faith later.
2. Put communications in writing whenever possible. Follow up phone calls with emails summarizing what was discussed. Request explanations for delays or denials in writing.
3. Study your policy like it’s the last chapter of a mystery novel. Know exactly what’s covered and what isn’t. Insurance companies count on you not understanding the fine print.
4. Consider filing a complaint with the Oklahoma Insurance Department. They can sometimes apply pressure when individual consumers can’t.
5. Talk to an attorney who specializes in bad faith insurance claims. Most offer free consultations, and many (including our firm) work on contingency, meaning you don’t pay unless we win your case.

What Can You Recover in a Bad Faith Case?

When an insurer acts in bad faith, Oklahoma law provides powerful remedies. It’s not just about getting the money you were originally owed. In successful bad faith claims, our clients have recovered:

• The full amount originally owed under the policy
• Additional compensation for financial losses caused by delays or denials
• Damages for emotional distress
• Punitive damages in cases of particularly outrageous conduct
• Attorney fees and costs

Why You Shouldn’t Face Insurance Companies Alone

Insurance companies aren’t just casual opponents. They employ teams of adjusters, investigators, and attorneys whose entire job is finding ways to minimize payouts. When you suspect bad faith, trying to fight alone is like stepping into the boxing ring with one hand tied behind your back.

At 222 Injury Lawyers, we’ve successfully challenged insurance carriers who thought they could steamroll over Oklahoma policyholders. We understand their playbook because we’ve seen it countless times, and we know exactly how to hold them accountable.

If you think your insurance company is acting in bad faith, we’d like to hear your story. Contact our team for a free, no-obligation consultation. With offices in Tulsa and Oklahoma City, we’re ready to evaluate your situation and help you understand your options. Remember, insurance companies have a legal duty to act in good faith – and when they don’t, we’re here to help you hold them accountable.