Is it possible suing the insurance company for emotional distress? The answer is yes; you have the right to sue them if their actions have caused any mental distress. Although most insurance companies promise to work in good faith with the clients, this only sometimes happens. In many instances, they fail to fulfill their obligations. Their negligence, at times, causes a great deal of mental stress and emotional breakdown for the clients.
Emotional distress is not due to any particular reason. It is hard to tell what actually causes mental stress. The case varies from person to person. In the case of insurance companies, it is due to unfair claim denials, delays in processing claims, or abusive treatment. If you have faced stress due to any of these reasons, then you can file a lawsuit, provided you know the legal grounds. This article will highlight the four legal reasons to sue the insurance company.
What Does Emotional Distress Mean?
Emotional distress means the mental suffering that one party has to face at the hands of the other. It can cause mental conditions ranging from sleeplessness to anxiety. The other can be more serious psychological issues. It is equally important to fight for your psychological rights as it is in case of other problems. Apparently, these problems seem very small but can end up in long-term suffering that affects the individual and collective life.
What Legal Rights Do I Have Against Insurance Companies?
Policyholders have specific legal protections against insurance companies. Under this legal umbrella, they can enjoy the benefits of various laws and regulations. These legal rights guarantee fair treatment and accountability. In order to enjoy these rights as the policyholder, it is essential to know if you have a valid claim for emotional distress.
What Does Emotional Distress Mean In Law?
In the eyes of the law, being in emotional distress is a kind of damage to personal and collective life that can be claimed in a lawsuit. The different types of emotional distress include acute stress disorder, post-traumatic stress disorder (PTSD), and general anxiety. According to laws, mental distress can have a wide impact upon the lives that interrupts in their personal and professional lives.
What Are the Legal Grounds for Suing the Insurance Company?
Before suing the insurance company for causing mental distress, it is important to establish legal grounds to prove yourself regarding the actions that can cause the suffering. The four major legal grounds to support the lawsuit are as follows:
1. Bad Faith Insurance Practices
Such practices mean that the insurer cannot fulfill its obligations related to the policyholder. Such practices include denying valid claims, failing to investigate claims promptly, or offering unreasonably low settlements.
For example, an insurance company can deny the claim without a valid reason. It may also include misleading the policyholder and delaying the payments. These actions can lead to mental stress because they ultimately result in financial stress.
If you can prove any of the above practices, you can get compensation. After taking legal action, the courts will end up giving financial support. This will not just be a punishment but will also ensure that such acts do not happen in the future.
2. Unreasonable Claim Denial
Unreasonable claim denial means that there were no legal grounds to deny the insurance claim. It usually happens due to a lack of proper evidence, insufficient investigation, or failure to interpret the policy properly.
If the insurer denies any claims without a strong reason and if the case is proved before the court, the company is penalized. This happens because it creates emotional distress for the claimant.
3. Delayed Claim Processing
There is no doubt that policyholders will suffer from significant stress if there are delays in claim processing. The longer the delays, the more stress they will bring for the policyholder. These delays are also due to unreasonable reasons. The court takes such matters seriously as they harm the mental life of the policyholder.
4. Harassment and Abuse
Harassment and abuse by the insurance company mean the plaintiff is facing threats or coercive tactics. The purpose of these tactics is to force the policyholders to settle for the minimum. Such acts have resulted in extreme emotional problems. If this is proved as well, the court decides on compensation.
How to Prove the Emotional Distress?
If you have a plan to sue the insurance company, it is important to provide the following proof:
Strong Evidence
To make a legal claim, you must provide medical records, psychiatric evaluations, and personal testimonies. They must clearly define how you are suffering mentally.
Documentation
Testimonies of close ones are a great support. In addition, it is important to keep a record of the interaction with the insurer.
How to Hire the Right Attorney?
After you decide to sue an insurance company for mental distress, it is important to get proper legal assistance. Here is what you have to do before looking for the right attorney.
Find a Specialist
You may encounter several legal experts, but not all of them specialize in the legal area that you want to be covered. Find out all about the attorney before hiring him for the job. Get legal assistance from the one who actually knows all about insurance companies and their related challenges. If they understand the complexities of the affair along with mental challenges, then they will be able to help you.
How Much Does it Cost?
The cost varies from attorney to attorney and depends on experience and expertise. Check the cost of the attorney you are considering. It is better to choose an attorney to sue the insurance company. You can also find an attorney who works on a contingency basis. This means they will get the fee only if you win your case.
How to File a Complaint?
- Start with the formal complaint with your insurance company. Discuss the matter with the company.
- If the problem still needs to be solved or is not settled as required, contact the state’s insurance department or regulatory body.
- Seek legal assistance as the final step. The attorney will represent you in the court of justice. Make sure you have documented all the responses properly.
- After completing the documents and collecting the possible evidence, you are now ready to sue the insurance company.
- The trial time varies from case to case. Settlement may take months and, in some cases, even years.
What Is Potential Compensation for Emotional Distress?
The compensations are according to the kind of damages. The damages fall under two categories:
- Economic damages or financial losses
- Noneconomic damages that include any physical or mental suffering.
The court decides on compensation depending on the severity of the matter and how it impacts the lives of the parties involved. In addition to the impact, the court also takes into account medical expenses related to mental health treatment.
Defenses by Insurance Companies
In the court of justice, the insurance companies may argue in the following way to defend their position.
- They can come up with the argument that the distress is not too severe. They can mention other factors contributing to the stress and depression to make sure they get the clean chit and stand out to be innocent.
- Their attorney can provide the documents proving that there was no negligence on the part of the insurance company.
What are the Alternative Ways to Settle the Dispute?
There are other alternatives for those who want to settle the matter out of court. These alternatives can help handle the matter economically and less stressfully.
Mediation
Mediation means settling the matter through a neutral third party. His job is to help the parties negotiate so it is easy to settle. Mediation is a faster and less adversarial way to settle matters out of court.
Arbitration
The second way to settle the problem is arbitration. Instead of suing the insurance company, you can seek the help of the arbitrator. He is an individual who listens to the ideas of both sides and then makes the ultimate decision. Arbitration is easier than suing the insurance company and more formal than mediation. In addition, it takes less time than litigation.
How Can the Alternatives Help?
Alternative methods are easier and can greatly help, especially for those with limited resources and time. Opting for these alternatives can save time and legal costs. The outcomes are mutually agreeable.
Also Read: Reasons to Sue a Cemetery: 7 Important Facts to Know Now
Conclusion
Understanding your rights as a policyholder is crucial when dealing with an insurance company. If their actions have caused you significant emotional distress, you have the legal grounds to seek compensation. By recognizing bad faith practices, unreasonable claim denials, delayed processing, and harassment, you can take appropriate legal action. Always document your interactions, consult with a specialized attorney, and seek support from mental health professionals to strengthen your case. Remember, standing up for your rights can lead to a fair resolution and compensation for the emotional harm you’ve endured.
Frequently Asked Questions
What does emotional distress mean?
It is the mental suffering that usually happens due to another party’s actions. Emotional stress means anxiety, depression, and other psychological impacts.
Can I think of suing the insurance company for mental distress?
Yes, if you have enough information regarding the mental distress and what the insurance company has done, then you can sue.
What are the grounds for suing the insurance company for emotional distress?
The main grounds include bad faith practices, unreasonable denial, delayed claim processing, and harassment or abusive conduct.
Do I need some proof for suing the insurance company?
You will need medical records, psychiatric evaluations, and personal testimonies for suing the insurance company.
Will I get any compensation?
Yes, you can get economic damages in case of financial losses and noneconomic damages for pain and suffering.
Do I need an attorney for suing the insurance company?
Yes, hiring a specialist legal advisor or attorney can increase your chances of success.
Can I still sue if my claim was denied, but I am unsure if it was unreasonable?
Yes, check with your attorney if you think the claim denial was unreasonable. However, you still have grounds for suing the insurance company.
What steps should I take if I feel my insurance company is causing me emotional distress?
Document all interactions with your insurer, seek legal advice and consider filing a formal complaint with your insurance company and your state’s insurance department.
