LAW OFFICE OF PAUL DEPETRIS
paul@newjerseylemon.com
Your Subtitle text

New Jersey Homeowner’s Insurance Bad Faith Lawsuit FAQs

INTRODUCTION
Read below to learn more about this topic. Or, to receive a no cost phone consultation, call Mr. DePetris at 609-714-2020 or send him an email. Warning – this article does not necessarily include every New Jersey court rule, code or law that may apply to your New Jersey case! The Law Office of Paul DePetris does not guarantee that the statutes, rules, codes, files or forms on this website are the latest versions, that they lack typographical errors or that they have not changed, repealed or superseded by other laws. Before taking any action, read all applicable federal and state source law and case law and consult with an attorney. Court addresses, hours of operation and directions may change so check with the court in advance of mailing documents to court or going there! Some of the webpages on this site don’t apply to all types of New Jersey cases, since there are different rules for different case types!

NEW JERSEY HOMEOWNER’S INSURANCE BAD FAITH LAWSUIT FAQS

WHAT IS A NEW JERSEY HOMEOWNER’S INSURANCE BAD FAITH LAWSUIT?
A New Jersey homeowner insurance bad faith lawsuit is a "first party " lawsuit against a New Jersey Homeowner’s Insurance Company because of the New Jersey Homeowner’s Insurance Company’s failure to settle a New Jersey Homeowner’s insurance claim, as opposed to a suit based on the New Jersey Homeowner’s Insurance Company’s failure to settle a third plaintiff or New Jersey defendant tort claim for a reasonable sum. A New Jersey Homeowner’s Insurance Company owes a duty of good faith to its New Jersey Homeowner insured in processing a first-plaintiff or New Jersey defendant claim. Every New Jersey Homeowner Insurance Contract imposes on each plaintiff or New Jersey defendant the duty of good faith and fair dealing in its performance and its enforcement. In addition to the express terms of a New Jersey Homeowner’s Insurance Contract, the law provides that every New Jersey Homeowner Insurance Contract contains an implied covenant of good faith and fair dealing. This means that, even though not specifically stated in the New Jersey Homeowner’s Insurance contract, it is implied or understood that each plaintiff or New Jersey defendant to the New Jersey Homeowner’s Insurance contract must act in good faith and deal fairly with the other New Jersey plaintiff or New Jersey defendant in performing or enforcing the terms of the New Jersey Homeowner’s Insurance contract. To act in good faith and deal fairly, a plaintiff or New Jersey defendant must act in a way that is honest and faithful to the agreed purposes of the New Jersey Homeowner’s Insurance contract and consistent with the reasonable expectations of the New Jersey plaintiffs and New Jersey defendants. The New Jersey Homeowner Insurance Company commits bad faith, dishonestly, or with improper motive to destroy or injure the right of the other New Jersey plaintiff or New Jersey defendant to receive the New Jersey Homeowner’s Insurance benefits of the New Jersey Homeowner’s Insurance contract.

WHAT MUST THE NEW JERSEY HOMEOWNER PROVE TO WIN A NEW JERSEY HOMEOWNER’S INSURANCE BAD FAITH LAWSUIT?
To prove a New Jersey Homeowner’s Insurance bad faith lawsuit, first, the New Jersey Homeowner must prove that some type of contract existed between the New Jersey plaintiffs and New Jersey defendants. There can be no breach of the covenant of good faith and fair dealing unless the New Jersey plaintiffs and New Jersey defendants have a New Jersey Homeowner’s Insurance Contract. Second, to prove a New Jersey Homeowner’s Insurance bad faith lawsuit, the New Jersey Homeowner must prove that the New Jersey Homeowner’s Insurance Company acted in bad faith with the purpose of depriving the New Jersey Homeowner of rights or New Jersey Homeowner’s Insurance benefits under the New Jersey Homeowner’s Insurance contract. Third, the New Jersey Homeowner must prove that the New Jersey Homeowner’s Insurance Company’s conduct caused the New Jersey Homeowner to suffer injury, damage, loss or harm.

THE FAIRLY DEBATABLE STANDARD – THE BASIS FOR FINDING A NEW JERSEY HOMEOWNER’S INSURANCE COMPANY ENGAGED IN BAD FAITH IN FAILING TO PAY A NEW JERSEY HOMEOWNER’S INSURANCE CLAIM
To prove a New Jersey Homeowner’s Insurance bad faith lawsuit, the New Jersey Homeowner must show the absence of a reasonable basis for denying New Jersey Homeowner’s Insurance benefits of the policy and the New Jersey Homeowner’s Insurance Company's knowledge or reckless disregard of the lack of a reasonable basis for denying the New Jersey Homeowner’s Insurance claim. The lack of a reasonable basis may be inferred and imputed to a New Jersey Homeowner’s Insurance Company where there is a reckless indifference to facts or to proofs submitted by the New Jersey Homeowner. The New Jersey Homeowner’s Insurance Company acts in bad faith in delaying the processing of a valid claim when: (1) the New Jersey Homeowner’s Insurance Company’s conduct is unreasonable, and (2) the insurer knows that the conduct is unreasonable or recklessly disregards the fact that the conduct is unreasonable. Thus, for example, when a claim is lost in the computer, those processing the New Jersey Homeowner’s Insurance claim should not be penalized for their efforts when, through no intentional act, a claim runs afoul of the system. Neither negligence nor mistake is sufficient to show that the New Jersey Homeowner’s Insurance Company acted in bad faith.

WHAT DAMAGES CAN A NEW JERSEY HOMEOWNER RECOVER IN A NEW JERSEY HOMEOWNER’S INSURANCE CLAIM?
Under New Jersey contract law, a plaintiff or New Jersey defendant who breaches a New Jersey Homeowner’s Insurance Contract is liable for all of the natural and probable consequences of the breach of the New Jersey Homeowner’s Insurance Contract. Compensatory damages are designed to put the injured New Jersey Homeowner in as good a position as he would have had if performance had been rendered as promised. Implicit in these principles is some notion of foreseeability – did the New Jersey Homeowner’s Insurance Company knew or should they have reasonably foreseen that the New Jersey Homeowners were "at risk" of economic loss in addition to the policy New Jersey Homeowner’s Insurance benefits and that "ascertainable economic damages would ensue from the conduct" of the New Jersey Homeowner’s Insurance Company? Absent egregious circumstances, no right to recover for emotional distress or punitive damages exists for the New Jersey Homeowner’s Insurance Company's allegedly wrongful refusal to pay a first-plaintiff or New Jersey defendant New Jersey Homeowner’s Insurance claim.

NEW JERSEY HOMEOWNER’S INSURANCE CLAIMS SUMMARIZED
In a New Jersey homeowner ‘s insurance bad faith lawsuit, a New Jersey Homeowner’s Insurance Company may be liable to a policyholder for bad faith in the context of paying New Jersey Homeowner’s Insurance benefits under a policy. The scope of that duty is not to be equated with simple negligence. In the case of denial of New Jersey Homeowner’s Insurance benefits, bad faith is established by showing that no debatable reasons existed for denial of the New Jersey Homeowner’s Insurance benefits. In the case of processing delay, bad faith is established by showing that no valid reasons existed to delay processing the New Jersey Homeowner’s Insurance claim and the New Jersey Homeowner’s Insurance Company knew or recklessly disregarded the fact that no valid reasons supported the delay. In either case (denial or delay), liability may be imposed for consequential economic losses that are fairly within the contemplation of the New Jersey Homeowner’s Insurance Company. New Jersey courts deciding New Jersey bad faith first part insurance cases carefully scrutinize the proofs of extra-contractual damages to insure that juries are not given potentially misleading items of evidence – the evidence of losses due to the New Jersey Homeowner’s Insurance Company’s bad faith must generally be connected with the provable losses that were fairly within the contemplation of the New Jersey Homeowner’s Insurance Company when it made its breach of good faith in processing the New Jersey Homeowner’s Insurance claim.

NEED HELP WITH YOUR NEW JERSEY CASE?
Handling your New Jersey case wrong from the beginning may only cost you more money and time in the end!! Do it right the first time by seeking legal advice from a competent New Jersey lawyer!
Let the Law Office of Paul DePetris help you with your New Jersey case. Not all New Jersey cases require you to pay expensive legal fees to get legal help. 
 

Website Builder