What is insurance bad faith?
In Colorado, insurance companies have an obligation under state law to act in good faith. As part of this duty of good faith, insurance companies are required to do the following, among other things, in handling your claim:
- Promptly investigate your claim
- Promptly pay your claim
- Communicate regularly with you regarding the status of your claim
- Promptly pay you any undisputed portion of claim
- Provide a prompt and reasonable explanation of any claim denial or offer compromise settlement
If an insurer fails or refuses to do any of the above, then your insurance company may have acted in bad faith.