Incorrect cases should in fact be mentioned "lack of good faith" cases, because the obligation is that the insurance company should act in good faith and fairly handle the policyholder. "Bad" has nothing to do with it. Alabama, however, bears the definition of "bad faith" one step further by delimiting one thing into action for "abnormal evil faith".
Cole v. Owners Insurance Company 1 unique standard of Alabama "abnormal" evil faith:
Abnormal "evil faith assumes the elements of" normal "evil faith and adds a conditional fifth element:" the plaintiff must prove the insurer's intentional failure to determine whether there is a legitimate or accusatory reason to refuse to pay the claim. "… In fact, a plaintiff under" abnormal "evil beliefs can state that the insurer had real knowledge of the lack of a legitimate or justifiable reason to deny the claim because the insurer deliberately failed to determine whether such reason existed …. "abnormal" evil faith theory is related to intentional ignorance. The insurer cannot refuse to investigate the claim or stick the head in the sand and avoid bad faith by not discovering whether it had any legitimate or justifiable reason to deny a claim.
Thorough investigation of Facts related to coverage and facts related to evaluating the value of the loss are quite common tasks all insurance adjusters are taught that they must perform immediately after termination of the loss, I am not sure what is "abnormal" about that duty because it is not can be "normally" result in incorrect decisions out about coverage or amounts of loss by not doing a thorough investigation. Yet I often say that different teams in different states are often not wrong or right, they just reflect a different view of justice.
Car owners must have their defense consultants in different states going to a similar training camp because its new modus operandi including cold tactics, is to aggressively claim fraud and demand repayment when confronted with accusations of evil believe. In this Alabama case, the federal judge had none of it:
The owners claim that Coles committed fraud by claiming that they could not save their furniture and that the entire roof had been damaged. The owners also respond that "the extreme difference" between its valuation of the loss and Cole's "very inflated values" proves Cole's fraud. The owners misunderstand a misrepresentation of fact against the representation of an opinion. In this case, Colesna presented in the material they provided to owners an idea of their losses. Owners, who have made separate conclusions about the value, treat their own views on the value as fact. But undoubtedly a disagreement over a dollar amount for loss is not equal to fraud or distortion. Neither Coles, nor owners, have established a fact about the values - the parties have only presented different views on how much damage the fire caused. Consequently, the Court will grant Cole's draft summary judgment to their advantage for the owner's cancellation of contractual claims based on Coless's alleged fraud and distortion.
Systemic evil beliefs and disputes tactics from insurers may eventually be exposed by an organized effort by certain policyholders in various law firms throughout the country. If you have information, cases or claims similar to the above, please contact me at (813) 229-1000, and plan to go to AJA Bad Faith Litigation Group Meetings.
The thought of the day ]
Ignorance is not bad faith. But persistence in ignorance is.
1 Cole v. Owners Ins. Co. 326 F.Supp.3d 1307, 1327 (N.D.Ala., 2018).