Indiana Claims Handling & Insurance Bad Faith

Indiana recognizes a common-law insurer duty of good faith to its insured

Erie Insurance Co. v. Hickman recognized that an insurer owes its insured a legal duty of good faith and fair dealing and that breach can support a tort claim. The relationship and duty are grounded in the insurer-insured contract, not merely in a third party’s dissatisfaction with liability handling.

A good-faith coverage or amount dispute is not automatically bad faith

Hickman identifies misconduct such as unfounded refusal to pay, unfounded delay, deception and unfair settlement pressure, while making clear that a good-faith dispute about coverage or the amount of loss does not itself establish bad faith.

Regulatory unfair-claims practices are separate from the tort

IC 27-4-1-4.5 supplies regulatory claims-practice standards. A listed regulatory practice can provide context, but the common-law tort has its own duty and proof requirements and should not be reduced to a checklist violation.

Build the insurer decision-time chronology

Preserve the policy, claim submissions, investigation, information requests, coverage explanation, offers, payment/denial dates and what the insurer knew when it acted. Separate contractual entitlement from alleged tortious handling.

PUBLIC-INTEREST LEGAL EDUCATION

VictimsGuide does not provide legal services or create an attorney-client relationship. Insurance requirements, deadlines, remedies and controlling authority can change. Verify current primary authority, policy language and the law applicable to the particular event before legal reliance.