Insurance Company Allegedly Acts In Bad Faith By Denying Coverage For Medical Emergency

Victoria Negron

Written by
— Updated on May 4, 2020

Bad Faith Insurance Expert

This case involves an insurance bad faith claim levied against a medical insurance provider. The plaintiff, a middle-aged woman who hadn’t received medical coverage in many years, applied online for a policy to be effective the next day. The day after that, the plaintiff suffered a severe diabetic attack during which her blood sugar level rose to 1000. Because the diabetic attack was so close in time to when she set up coverage, it immediately went under review with the insurer. She was denied coverage because the insurance company believed it was clear that she was highly symptomatic in the five years prior to the policy, and because a “reasonable person” would have sought medical care in this scenario. The plaintiff sued the insurance provider, claiming they acted in bad faith to deny her coverage. An expert was sought review the records and insurance filings to determine if it was reasonable to deny coverage.

Question(s) For Expert Witness

  • 1. Please briefly describe your experience/familiarity with insurance bad faith as it relates to similar claims as the one in this case.

Expert Witness Response E-044264

An insurer’s duty is to fairly and reasonably review policy language with an eye toward providing coverage, unless policy terms do not apply to the situation at hand or one or more exclusions or conditions preclude coverage. Whether that insurer’s duty is fulfilled is determined by the reasonableness of the insurer’s actions in reviewing all aspects of the case and treating the putative insured fairly in carrying out that duty. Here, the putative insured presented via online application for next day coverage, as a person without medical treatment or coverage for years. However, she had personal awareness of symptomatology consistent with a diabetic condition. It is not bad faith to question coverage given her history and the diabetic attack one day after inception. An insurer acts reasonably and in good faith in forming an opinion that a putative insured under these circumstances was highly symptomatic in the five years prior to inception, if in doing so, it reasonably concludes those symptoms existed. Moreover, it is good faith to expect that a “reasonable person” would have sought prior medical treatment given these circumstances.

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