Charleston Insurance Coverage and Bad Faith Attorneys
Clawson and Staubes regularly represents and advises clients in a variety of insurance related matters. We frequently represent insurers with the investigation, evaluation and litigation of disputed coverage claims. We also represent and defend insurers against claims that they acted in bad faith in investigating, adjusting or refusing to pay claims.
Our attorneys have handled a wide variety of insurance coverage litigation matters, including commercial general liability, liquor, homeowner’s, renter’s, motor vehicle, marine, garage, personal injury protection & medical payments, professional and director’s & officers, errors & omissions, excess, umbrella and cyber liability policy claims.
Insurance coverage issues can arise where carriers write policies across state lines where different regulations may apply. Coverage issues sometimes arise due to uncertainty as to whether a situation is covered by a policy or whether various provisions and exclusions found in a policy are valid. Other times, policy language may be ambiguous, open to interpretation or its application unclear under an unusual set of facts. Frequently seen coverage issues include:
- Who is an insured
- Scope of coverage
- Coverage endorsements
- Coverage exclusions and limitations
- Underinsured motorist (UIM) coverage analysis
- Uninsured motorist (UM) coverage analysis
- Stacking coverage
- Accident or occurrence
- Permissive user
- Additional insured
- Intended or expected injury
- Owned property exclusion
- Duty to defend
- Excess insurance disputes
Coverage disputes often involve questions regarding past interactions between the insured and the carrier, complicated forms and interpretations of state specific case law. Our attorneys are able to assist in the investigation of the facts surrounding the claim and provide an analysis as to the application of policy provisions. This coverage and claim handling advice from experienced professionals is crucial to the proper handling of disputed claims by insurers.
Coverage disputes sometimes require examinations under oath (EUO) to establish the underlying facts and applicability of coverage. Our attorneys have handled numerous EUOs and advised insurers as to the coverage issues involved. Coverage disputes are frequently resolved via a declaratory judgment action (DJA) wherein the court issues a ruling as to what is covered in the policy at issue or what certain policy language means under current laws and case law. As experienced insurance coverage litigation attorneys, we assist our insurance clients in obtaining declaratory judgments to protect their interests when coverage is unclear or when a proper denial of coverage must be enforced.
Bad Faith Litigation
In South Carolina, insurance bad faith can occur where an insurance company fails or refuses to pay out on a legitimate insurance claim on behalf of its insured. South Carolina Code §38-59-20 sets forth the acts that constitute improper claims practices if committed by an insurer without just cause and with such frequency as to indicate a general business practice:
- Knowingly misrepresenting pertinent facts or policy provisions related to coverage
- Failing to promptly acknowledge communications pertinent to claims
- Failing to implement reasonable standards for claim investigation and settlement
- Failing to promptly settle claims when liability is reasonably clear
- Compelling claimants to file suit by making unreasonable pre-suit settlement offers
- Threatening to invoke policy defenses without a reasonable expectation of prevailing
- Any other practice that constitutes an unreasonable delay or failure to settle claims
The two most common causes of action alleged in bad faith claims in South Carolina are breach of contract and bad faith. Other, less frequently alleged causes of action include unfair trade practices, fraud, constructive fraud and breach of contract accompanied by a fraudulent act.
Plaintiffs frequently allege breach of contract on the basis that they paid premiums to the insurer in exchange for certain coverages under the policy of insurance, which is a legally binding contract, and that the insurer breached this contract through its failure to pay the benefits owed under the coverage. The damages recoverable under the breach of contract claim are contractual in nature and are limited to the amount coverage under the insurance policy.
Plaintiffs also frequently allege bad faith on the basis that the insurer refused to pay benefits due under the policy of insurance due to bad faith or an unreasonable action in breach of the implied covenant of good faith and fair dealing. This can occur when an insurer refuses to indemnify the claimant or refuses to defend the claimant. The damages recoverable for bad faith are extra-contractual in nature, meaning that they are not limited to the amount coverage under the insurance policy. Bad faith damages include consequential damages, attorney’s fees and even punitive damages where the insurer’s actions were willful or in reckless disregard of the claimant’s rights.
Under South Carolina Code §38-59-40, in the event of an insurance claim where the insurer refuses to pay the demand within ninety days and it is determined at trial that the refusal was without reasonable cause or in bad faith, the insurer is liable to pay the holder, in addition to any sum or any amount otherwise recoverable, all reasonable attorneys’ fees for the prosecution of the case against the insurer up to one-third of the amount of the judgment.
Our attorneys regularly counsel insurers and adjusters as to best practices to avoid acting in a way courts view as unreasonable. We also represent insurers when they have been sued for breach of contract and bad faith.
Consult with an Insurance Coverage and Bad Faith Attorney
If you are in need of a South Carolina or North Carolina insurance coverage or bad faith attorney, our legal team at Clawson and Staubes is available to assist you. Contact us at (843)577-2026 to learn more about our services.