Why Some Lawyers Choose to Sue Insurance Companies Instead of Settling

Insurance companies get a bad rap for historically using bad faith tactics to deny property damage claims.  Texas law provides a litany of actions that are deemed bad faith conduct that you can sue your insurer for.  It’s important to hire a property insurance attorney to sue your carrier for bad acts.

“Suing the insurer" is a phrase that is often used to describe a property insurance policyholder's last resort when the insurance company wrongfully denies a claim or delays payment. The phrase conjures up images of a David and Goliath struggle, with the policyholder fighting an uphill battle against a large, faceless corporation. 

In reality, however, suing an insurance company is not always a David and Goliath battle. In many cases, policyholders who sue their insurers are actually fighting against Goliath's smaller cousin. In fact, many insurance companies that are sued by policyholders are much smaller companies that are subsidiaries of larger insurance.

More property owners are taking their carriers to court when they are mistreated by insurance adjusters and their claims are mishandled.  The number of policyholders suffering property damage is steadily increasing.  In Texas, claims for hail and hurricane damage are quite common.  

Since the Texas Freeze in 2021, more property damage claims were being filed for water damage from pipes bursting.  Roughly one in 50 insured homes have a property damage claim caused by water damage or freezing each year, according to the Insurance Information Institute.  When your home has been flooded by a sudden pipe burst, watch out for bad faith claims handling by your insurance company.  You don’t want to waste time haggling with your insurance company when you know they are not processing your claim in good faith.  Failing to make  settlement offers, failing to provide an estimate; and denying coverage when your property damage is actually a covered cause of loss are indicators of bad faith.

(Source: https://www.forbes.com/advisor/homeowners-insurance/when-to-hire-lawyer/)