Misrepresenting Facts or Policy Provisions
In California, insurance companies are required to deal fairly and in good faith with their policyholders. However, insurers sometimes engage in unfair practices that leave policyholders struggling to obtain the benefits to which they are entitled. One of the most significant of these unfair practices is the misrepresentation of policy provisions. Under California Insurance Code 790.03(h)(1), misrepresenting facts or policy provisions is a prohibited practice, and policyholders have the right to hold insurers accountable for such misconduct.
If your insurer is not dealing with you fairly regarding a health insurance or life insurance claim, the California insurance bad faith lawyers at Gianelli & Morris can help you obtain the benefits you are entitled to and that are unfairly being denied. In addition, we’ll seek compensation for any additional harm their bad faith conduct has caused, including seeking punitive damages in appropriate cases to hold them fully accountable and hopefully deter such conduct in the future.
California Insurance Code 790.03(h)(1)
California Insurance Code Section 790.03(h) identifies several actions by insurers as unfair and deceptive practices, including the act of “misrepresenting to claimants pertinent facts or insurance policy provisions relating to any coverages at issue.” This provision is designed to protect policyholders from insurance companies that provide misleading or false information about the terms and conditions of their policies.
When insurance companies misrepresent policy provisions, they often do so to deny, delay, or underpay claims. This practice can be detrimental to policyholders who rely on their health or life insurance benefits for financial protection during critical times.
Misrepresentation in Health Insurance Claims
Misrepresenting policy provisions is particularly damaging in the context of health insurance claims. Policyholders purchase health insurance to cover essential medical treatments, but when insurers fail to provide clear and accurate information about coverage, it can lead to delayed or denied medical care.
Example: Denial of Coverage for “Medically Necessary” Treatments
A common misrepresentation involves the insurer claiming that a medical treatment is not “medically necessary” according to the terms of the policy. For instance, a policyholder may be denied coverage for a procedure that their doctor deems necessary for their health. The insurer might assert that the procedure is not covered, citing vague or misleading language from the policy. In reality, the policy may explicitly cover medically necessary treatments, but the insurer misrepresents the policy’s terms to avoid paying the claim.
Example: Misrepresentation of Network Coverage
Another example is when an insurer misrepresents the extent of coverage for in-network and out-of-network care. A policyholder may be led to believe that a particular hospital or specialist is within their network, only to discover after receiving treatment that they are responsible for a significant portion of the cost because the provider is actually out-of-network. This form of misrepresentation can leave policyholders with unexpected and substantial medical bills.
Misrepresentation in Life Insurance Claims
Life insurance is meant to provide financial security to beneficiaries in the event of the policyholder’s death. However, insurers sometimes misrepresent policy provisions to avoid paying the full benefits owed. Misrepresenting exclusions, policy terms, or coverage limits can have a devastating impact on beneficiaries.
Example: Misrepresentation of Policy Exclusions
One common tactic is for an insurer to misrepresent exclusions in the policy. For instance, a life insurance company might wrongfully claim that a death is excluded from coverage due to certain policy conditions, such as a pre-existing condition or the manner of death. In some cases, the insurer may rely on ambiguous language in the policy to support their denial, even though the exclusion does not apply to the situation at hand.
Example: Delaying Payment by Misstating Policy Requirements
Insurers may also misrepresent the policy’s requirements for submitting claims in an effort to delay payment. For example, they might tell beneficiaries that additional documentation is needed, when in reality the required paperwork has already been submitted. This delay tactic not only causes frustration but can also create financial hardship for beneficiaries who are depending on the life insurance payout.
Legal Recourse for Policyholders
Under California Insurance Code 790.03(h)(1), policyholders have legal recourse when insurers misrepresent policy provisions. If a policyholder can demonstrate that the insurer misrepresented the terms of the policy and acted in bad faith, they may be entitled to damages beyond the original claim, including compensation for emotional distress and attorney’s fees, as well as punitive damages in appropriate cases.
Policyholders facing bad faith insurance practices should consider consulting an experienced California insurance law attorney. At Gianelli & Morris, we help health and life insurance policyholders hold insurance companies accountable for misrepresentation and other unfair practices. Our legal team is dedicated to fighting for your rights and ensuring that you receive the benefits you deserve under your policy.
Contact Gianelli & Morris for Help With Health and Life Insurance Claim Denials in California
Misrepresenting policy provisions is an unfair practice prohibited under California law. Whether related to health insurance or life insurance claims, misrepresentations can leave policyholders and beneficiaries without the coverage and financial support they are entitled to. If you believe your insurer has misrepresented the terms of your policy, contact Gianelli & Morris for a free case evaluation at 213-489-1600. We are here to help you navigate the complex landscape of insurance law and fight for your rights as a policyholder.
