Aline Tanner v. Metropolitan Life Insurance Co.

Monroe, Louisiana insurance law lawyer represented Plaintiff who sued Defendant on a bad faith breach of insurance contract theory.



Under Section 22:1892, an insurer must initiate loss adjustment within 14 days after notification of loss by the claimant, or within 30 days if there is catastrophic loss (unless extended by the commissioner). This means that an insurer must take substantive and affirmative steps to accumulate facts about the loss; simply opening a claims file is insufficient. Additionally, within 30 days of receipt of satisfactory proof of loss (i.e., information that is sufficient to fully apprise the insurer of the insured's claim), an insurer must (1) make a written offer to settle a claim, and (2) unconditionally tender a reasonable amount. The statute also requires insurers to make payment within 30 days after written agreement or settlement. Section 22:1892 imposes penalties and attorney's fees if the insurer fails to timely pay a claim, as outlined above, when the failure is found to be arbitrary, capricious, or without probable cause. "Arbitrary, capricious or without probable cause” is synonymous with "vexatious,” which is defined as "unjustified, without reasonable or probable cause or excuse and is not based on a good faith defense.” Penalties under the statute are either 50% of the damages on the amount found to be due under the insurance contract or $5,000.00, whichever is greater.

Settled and dismissed with prejudice.