An insurance company has a duty to protect its insured from an excess judgment when under all of the circumstances the insurance company could and should have done so had it acted fairly and honestly, and with due regard, for the interests of its insured.
This good faith duty imposed on an insurance company includes, among other things, the following:
- A proper investigation of the claim
- A proper evaluation of the claim
- Advising the insured of all settlement opportunities
- Advise the insured as to the probable outcome of the litigation
- Warn the insured of the possibility of an excess judgment
- Provide a proper defense
- Giving fair consideration to a settlement offer that was not unreasonable under the facts, and settle, if a reasonably prudent person would do so, when faced with the prospect of paying the total recovery
As attorneys, it is our duty to protect you if an insurance company violates any of their responsibilities, that result in bad faith.