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Dawson and Rosenthal
Dawson and Rosenthal

San Diego Misrepresenting Policy Terms

You are a policyholder who pays your insurance premiums faithfully and on time. In return, you have the reasonable expectation that your insurer will pay claims when you need them. Unfortunately, many insurance companies prioritize profits over claimant needs, a concept known as insurance bad faith. Misrepresenting the terms of a policy is one of the most common instances of insurance companies acting in bad faith. If you believe your insurance company is giving you the runaround, you may be able to file a claim for damages. Contact the attorneys at Dawson & Rosenthal, P.C. to schedule a free review of your legal options.

What Is Misrepresentation of Policy Terms?

Misrepresentation of policy terms, as the name implies, occurs when an insurance company deliberately or unreasonably misrepresents the facts and terms of a policyholder’s contract. The point of this misrepresentation is to issue a denial on an otherwise valid claim. Unfortunately, insurance companies routinely take advantage of an insured’s lack of knowledge to make claim denials. Without technical know-how or knowledge of insurance law, a policyholder might accept a claim denial that’s actually worthy of reimbursement.

Examples of Misrepresentation

Several different types of misrepresentation with regard to policy terms exist. Some of these include:

  • An agent making sweeping statements about coverage that do not exist.
  • Claims adjusters interpreting the terms of a policy unfairly to issue a denial of coverage.
  • Claims supervisors ordering adjusters to deliberately mislead a consumer or misrepresent the facts to issue a claim denial on a valid claim for benefits.

The California Insurance Code considers a misrepresentation of the terms of a policy to be insurance bad faith. Under state law, no insurer or an officer or agent of an insurer can articulate a statement that’s a deliberate misrepresentation of a customer’s policy.

What to Do After Misrepresentation of Policy

Some policyholders get the sense an insurance company is deliberately misleading them or misrepresenting the facts of the case. This sense is usually right. Knowing how to proceed following a suspected misrepresentation of a policy is essential. Take the following steps:

  • Get it in writing. Demand an explanation in writing if you are issued a denial of benefits for a seemingly valid claim. Claims adjusters must provide a valid basis for a claim denial based on the language specifically outlined in a policy.
  • Request to file an appeal. All policyholders have the right to request a second review and an appeal of their decision.
  • Contact an attorney for a free case review. The attorneys at Dawson and Rosenthal, P.C., have 50 years of experience dealing with insurance companies. We understand how companies will misrepresent the facts to avoid a claim payout. Contact us to schedule a free review of your case today.

Who Is Liable for Misrepresentation?

A misrepresentation of the facts may occur at any time in the insurance procurement or benefits process. For example, an agent may misrepresent the facts of an insurance policy when he or she promises benefits that don’t apply. Additionally, claims adjusters may deliberately misrepresent the facts when they interpret claims language to issue a denial when liability is clear.

The insurance company will generally be liable no matter who commits the representation. As agents and representatives of the company, employees must exercise good faith dealing, but the company itself is generally liable for their actions.

Insurance bad faith can take many forms, but misrepresentation of the facts is one of the most common. You may be able to file a claim for damages if you believe your insurance company has misled you. Contact the attorneys at Dawson & Rosenthal, P.C. today to discuss your legal options.