Hassle-Free Health Coverage: Bad Faith
Lawsuits or regulatory complaints relating to delays or denials usually allege bad faith on the part of the insurance company. This is one of the heaviest clubs a policyholder can wield to strike back at an insurance company.
One way in which an insurance company can act in bad faith is by not investigating a claim with an eye toward providing coverage.
"The investigation should be geared toward paying the claim, not denial. Nine out of 10 times, however, that investigation is designed to turn something up that justifies denying the claim. Their eye should be toward protecting their policyholder, but it's not," said William Shernoff of Shernoff, Bidart & Darras, a California-based risk management consulting group.
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