Editor's Note: Kevin Quinley is the principal of Quinley Risk Associates LLC and is frequently engaged in litigated matters involving institutional bad faith.
"Money is the root of all evil," or so we often hear. Whether we agree with the sentiment behind this statement or not, this idea often surfaces in institutional bad faith claims. Some observers view institutional claims as the Ebola virus of bad faith litigation because of expensive discovery and the potential for punitive damages.
Plaintiffs argue that management practices stack the proverbial deck in such a way as to incentivize claims staff to shortchange insureds and claimants. Institutional bad faith claims may include issues of performance evaluations, use of computerized claim valuation software and lack of training. One prominent theme of such claims is that company management improperly links adjuster income to hitting certain financial goals.
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