Insurance 101 – Chapter 11 – Volume 25 – Limits on Bad Faith

Limits on Bad Faith

The Court of Appeal, in Jonathan Neil refused to allow that every breach of an insurance contract (any more than every breach of contract) will allow a plaintiff to recover tort damages. The court was satisfied the “insurance cases” exception preserved in Freeman & Mills does not extend to every breach of an insurance contract. The covenant of good faith and fair dealing is reciprocal, binding both the insurer and the insured. Nevertheless, an insured is not guilty of the tort of bad faith when the insured breaches the covenant; in those circumstances the insurer is limited to contract remedies.

The following video was adapted from my book, “Insurance Claims A Comprehensive Guide” Published by the National Underwriter Company and is available at the Zalma Insurance Claims Library

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The author and publisher disclaim any liability, loss, or risk incurred as a consequence, directly or indirectly, of the use and application of any of the contents of this blog. The information provided is not a substitute for the advice of a competent insurance, legal, or other professional. The Information provided at this site should not be relied on as legal advice. Legal advice cannot be given without full consideration of all relevant information relating to an individual situation.

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