If you’ve ever dealt with the claims department at an insurance agency, you know how difficult it can be to get matters resolved. One insurer’s claims practices in California are specifically bad and consumers have taken to the internet to voice their frustration. Just type in the company name (Mercury Insurance Group) and the word complaint and see for yourself. Time and time again, these consumers complain about Mercury Insurance Group claims representatives saying that they will ‘get right on it’, but then months go by with no action at all. And when policyholders call back to check on the status of their claim, either the claim number cannot be found, the person to whom they last spoke can’t be found or nobody seems to know the status of their claim.

Is it bad faith?

Does Mercury Insurance Group’s poor claims representation amount to bad faith? Many think so. Insurance companies have a duty to act “in good faith and fair dealing”. As such, they are required to:

• Adjust claims (deny or pay) within a reasonable time frame
• Explain the benefits and requirements of your policy
• Respond to your questions in a reasonable amount of time
• Explain to you (in writing) why they are denying your claim or paying less than the damage amount and why.

Most states require insurers to follow the rules described above. In California, insurers are required to send a follow up letter every 30 days. Unfortunately, this doesn’t always happen.

For many, the information that actually is sent after a claim is reported can sometimes be very confusing in and of itself – leaving policyholders in the dark about what happens next. While this might seem inconsequential in the case of a minor fender bender, it becomes much more serious in the case of a fire that destroyed a home. In one report, a Mercury Insurance Group customer’s home was destroyed by fire and it has not yet been rebuilt – four years after the event occurred and with little communication or follow through by the company despite repeated pleas from the homeowner. That is certainly bad faith.

What can you do to “keep the ball rolling”?

According to Attorney Bob Scott, a partner with the Advocate Law Group, “You shouldn’t wait two months [before taking action]. You need to write to a supervisor of the company and say ‘I don’t know what’s going on. What’s the problem? Nobody’s telling me anything!’ Insurance claims follow the old saying, ‘The squeaky wheel gets the grease’. You should be polite, appropriate and not nasty. You should send good factual letters and document what’s going on. If you’re not getting satisfaction from the claims handler, ask for the name of their supervisor. Write a letter to the supervisor, copy the claims handler, and send all the letters you’ve sent in the past and push it up the ladder!”