A majority of Americans believe that laws allowing people to sue their own auto insurance company for punitive damages, in addition to receiving benefits for their insured claim losses, are not a good idea.
New public opinion survey findings from the Insurance Research Council (IRC) indicate that 26 percent of those surveyed said that allowing such lawsuits was a poor idea, and 31 percent said it was only a fair idea.
A first-party bad-faith lawsuit is one where individuals sue their own insurance company because they believe the company acted in “bad faith” in the settlement of their claim. Only a few states allow individuals to sue their own insurance company in this manner, although several states have recently debated, and rejected, legislation authorizing first-party bad-faith lawsuits.
The survey also asked whether respondents would be willing to pay more for insurance in order to allow first-party bad-faith lawsuits. Forty-seven percent said they were “not at all willing” to pay more and 24 percent said they were “not very willing” to pay more. Even among those who thought that allowing first-party bad-faith lawsuits was a good or an excellent idea, one-half (51 percent) said they were unwilling to pay more for insurance in order to allow the lawsuits.
“These findings indicate a substantial lack of public support for legislation that would generate more lawsuits and higher costs for insurance consumers,” said Elizabeth Sprinkel, senior vice president of the IRC.
Nerd of Insurance says: 
Exppert says: 
T Mac says: 
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