What are the duties of an insurance company to its insured in an insurance litigation case?

In California, an insurance company must abide by certain duties to its insured when a lawsuit is brought due to an insurance claim. These duties are outlined in the Unfair Insurance Practices Act and the Insurance Code. The insurance company must investigate the claim and act in good faith and with fair dealing when evaluating it. This includes making an effort to inform the insured in a timely manner about the claim, any decisions made, relevant deadlines, and other important information. The investigation must also be conducted in a prompt and fair manner, with disclosure of all relevant information. The insurer must also take all reasonable steps to settle the claim, if it appears that the amount being sought is significantly lower than the amount of liability the insurer could be found to have. Ultimately, the insurer has a duty to settle the claim within the policy limits, if settlement is possible. Finally, the insurer must also act with reasonable promptness to pay all valid claims and to provide appropriate remedies, including court-awarded damages. This means they must not delay payment or employ tactics such as nonpayment or refusal to consider the claims to try to avoid paying. In California, insurance litigation cases involving an insurer and its insured can be very complicated. It is important for the insured to understand their rights and the duties of their insurer when filing an insurance claim.

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What are the duties of an insurance company to its insured in an insurance litigation case?

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