Commercial insurance providers often deny claims for the following reasons:

• Filing errors

• Misreading policy terms

• Lapsed coverage

• Uncovered damage

• Delayed filing

• Failure to mitigate

• Insufficient documentation

• Normal wear and tear

• Suspected fraud

Insurance bad faith arises when your insurer unreasonably delays or unjustly denies a valid claim. Insurance companies may act in bad faith when they deny valid claims, delay investigating or processing a claim, or offer lowball settlements.

Colorado insurance bad faith cases typically involve three legal claims breach of contract, common-law bad faith, and statutory bad faith. If your insurance company didn’t fulfill its duty, acted unreasonably, or unfairly delayed or denied a claim, you can sue for attorney fees, court costs, and double the amount.

In most bad faith lawsuits, the insurer can be sued under two or more of these claims at the same time.