7263. Bad Faith Claims In Insurance Disputes

In recent decades, bad faith claims have become a vitally important aspect of insurance coverage litigation. Unlike the insurance coverage dispute, which focuses on whether there is coverage under the subject insurance policy, bad faith claims address whether the insurer acted reasonably in its claims handling, including decisions with respect to the defense and/or settlement of the underlying claim. This course will explain how bad faith has emerged since the 1950s at the intersection of contract and tort law, leavened by a complex skein of insurance regulations and state consumer protection statutes that complement the common law doctrine of the covenant of good faith and fair dealing that is said to be an implied term of all contractual relations. We will analyze the different strategies that policyholders employ in prosecuting bad faith claims and the means by which insurers resist them, as well as the damages that can be awarded in these cases, including statutory awards, damages for emotional distress and punitive damages in extreme cases.