This article expresses the views of attorney Bonny G. Rafel Esq. View other articles by Ms. Rafel at
BAD FAITH IN THE HANDLING OF DISABILITY CLAIMS:
IS IT REAL OR IMAGINED?
By: Bonny G. Rafel
Insurance carriers say that consumer lawyers cast too wide a net, hoping to catch
some bad faith along the way. Their notion is that we rush to judgment, by claiming the
tort of bad faith in most complaints for the termination or denial of disability benefits.
Perhaps if carriers heeded our requests for claim files pre-litigation we could evaluate the
existence of bad faith at that time, rather than waiting until discovery to do so.
Allow me to amplify the current state of bad faith law in the disability arena. This
article first considers the groundbreaking cases of the last century, which taught us to
enter the long corridor of bad faith litigation armed with supportive evidence to prove our
claim. Then I consider the many new age cases which have brought in the high tide of
disability bad faith law that is finally emerging on the shores. Rather than be caught in
the undertow of motions for summary judgment on a bad faith count, litigators can
prepare discovery to uncover the elements of bad faith conduct, and if it exists, be
prepared to face summary adjudication on this most important facet of disability
An interesting article authored by a defense attorney and appearing in DRI
Magazine in 1996 has been circulating for some time. It includes an interesting
observation: “bad faith, as opposed to alleged bad faith is exceedingly rare” (so is a pear
shaped diamond, but they too exist and are cultivated).
The author proposed some “advice” to reduce the vulnerability of the company to
the allegations of bad faith. For instance, he maintained that the claim file should
document the company’s desire to find out the true facts and demonstrate the company’s
effort to fairly interpret policy language. I couldn’t agree more. It should be noted