Meeting with Bad Faith Insurance LawyerWhen you purchase any type of insurance policy in Illinois, you’re paying for financial protection and security.  In exchange, the insurance company agrees to compensate you per the terms of your policy in the event of a catastrophic event like a fire, death, disability, or car accident. You sleep easy at night knowing your family’s financial future is safe.

But what happens if your insurance company doesn’t hold up their end of the contract? What if they deny your claim outright—and you’re left to pick up the pieces financially?

Sometimes, an insurance company breaks the law when it denies a claim and refuses to pay benefits. In Illinois, insurers must uphold their duty of good faith and fair dealing according to the Illinois Insurance Code (215 ILCS 5). To summarize, an insurance company must put the interests of its policyholders above its own. When the insurer puts its interests first and therefore breaches this duty, it may be acting in bad faith.

If an insurance company acts in bad faith, you may have a claim against them. On this page, we discuss everything you need to know about these lawsuits. Keep reading to learn more about:

  • How insurance works in Illinois.
  • What is a bad faith insurance claim?
  • The difference between first-party and third-party bad faith insurance claims.
  • Types of compensation you can receive from an Illinois bad faith insurance lawsuit.
  • How long you have to file a lawsuit to hold your insurer accountable.
Play Video

Need a Lawyer Who Sues Insurance Companies? We'll Step Up to the Plate

If you believe an insurance company is putting their interests before yours, our bad faith insurance lawyers can help you hold them accountable. Contact Shannon Law Group, P.C. today for a free, no-obligation consultation. Call us 24/7/365 at (312) 578-9501 or fill out the form below to get started.

Contact Us

HERE'S WHAT YOU NEED TO KNOW ABOUT INSURANCE BAD FAITH CLAIMS

Bad Faith Insurance Attorneys

How Insurance Works in Illinois

Americans pay insurance premiums every year to protect themselves if they’re suddenly disabled at work or hit by an uninsured motorist. In the United States, the insurance industry is a trillion-dollar giant. According to the Insurance Information Institute, the total net premiums written totaled $1.32 trillion in 2019.

Illinois Insurance ClaimsAn insurance company’s job is similar to a bank's. It collects premiums, holds them, and then distributes payment fairly and quickly to claimants who suffer covered losses. Most of the time, it works. As mentioned earlier, insurance companies have a duty of “good faith” when handling insurance claims. They must treat their policyholders reasonably and fairly. Because of this duty, insurers are obligated to investigate claims and consider equally reasons to pay and deny claims based on the evidence.

But insurance companies are corporations. Their top priority is to make more money than they pay out in claims. As bad faith insurance attorneys, we’ve seen several insurers deny claims and delay settlement, only to expose their insured’s personal assets down the road.

When this happens, insurance companies may be acting in “bad faith.” The policyholder may have a right to file a lawsuit against their insurer for compensation. We discuss the acts of bad faith to watch out for in the next section.

In Illinois, bad faith claims can happen under any type of insurance coverage, including:

  • Auto insurance. Your auto insurance policy protects you from losing everything if you cause an accident or your car is stolen. You can buy several types of car insurance coverage under your policy, including liability, collision, comprehensive, and medical coverages. Illinois law requires that drivers purchase at least $25,000 in bodily injury coverage per person, $50,000 in bodily injury coverage per accident, and $20,000 in property damage coverage per collision. Drivers must also purchase uninsured/underinsured motorist bodily injury coverage for $25,000 per person and $50,000 per accident.
  • Disability insurance. People purchase disability insurance to help pay the bills if they’re sick or injured and unable to work. Average disability insurance policies replace between 50 and 60 percent of your income. There are two types of disability insurance:
    • Short-term disability: These policies typically kick in two weeks after a qualifying illness or injury. It pays for a portion of your income for a few months to a year.
    • Long-term disability: This coverage begins after a 90-day waiting period. It can supplement part of your income for months, years, or until retirement.
  • Health insurance. Health insurance policies offer peace of mind when a medical emergency strikes. Most policies cover the necessary treatment and medication your family needs to stay healthy. Once you hit your health plan’s deductible in a year, your insurance company will start paying on your behalf.
  • Homeowners insurance. This type of coverage protects your financial assets in the event of a natural disaster, fire, theft, or personal injury on your property. You may be required to purchase specific coverages depending on where you live. For example, you may be required to purchase flood insurance if your home is located close to a river.
  • Life insurance. If your family depends on you financially, you may consider purchasing a life insurance policy. Let’s say you passed away with a life insurance policy in force. Your family could claim your policy’s death benefit, which helps pay for future expenses like college tuition.
  • Small business insurance. This type of insurance helps protect small businesses from unexpected costs and liabilities. Entrepreneurs in Illinois often purchase general liability, property, auto, and life insurance policies to keep their business safe.
  • Renter’s insurance. If you rent, having renter’s insurance is a must. It protects your personal belongings in the event of a natural disaster or burglary.

What Are Bad Faith Insurance Claims?

Completing Insurance Claim FormBad faith insurance claims arise when an insurance company breaks its promise to act in a “duty of good faith.” As a result, the policyholder can pursue compensation from the insurance company for acting in “bad faith.” In Illinois, only the insured or an assignee has a cause of action against an insurance company.

Bad faith claims do not discriminate. They can happen under any type of insurance policy, including auto, disability, and health insurance.

There are two types of bad faith insurance claims you should know about: first-party and third-party claims. Keep reading to learn more.

Understanding First-Party Bad Faith Insurance Claims

First-Party insurance claimOnly policyholders can bring first-party claims against an insurance company.

So, how do you know if an insurance company acted in bad faith?

First, per Section 155 of the Illinois Insurance Code, your insurer must have done one of the following:

  • The insurance company disputed the amount of loss payable on a claim.
  • The insurer delayed settling a claim.
  • The insurance company refused to provide coverage.
  • The insurer failed to properly communicate with you.

Second, the insurance company’s action or delay must have been “unreasonable or vexatious.”

What’s “unreasonable or vexatious” conduct in the eyes of Illinois law? It has to meet three conditions

  1. There was no dispute regarding the insurance coverage;
  2. An insurance company refused to evaluate, investigate, or discuss a claim; and
  3. The insurance company’s attitude toward its insured was “irritating, exasperating, and provoking.”

If both criteria apply to your situation, you may have a bad faith claim in Illinois.

Keep scrolling to learn more about the types of compensation available to you in first-party claims.

If you have any questions, we’re happy to speak with you. Fill out the form at the bottom of this page to get started.

How Third-Party Bad Faith Insurance Claims Work

Bad Faith LawsuitThird-party bad faith insurance claims happen when a policyholder is sued by another party, and their insurance company steps in to defend them. While defending the policyholder in the lawsuit, the insurer must act in their insured’s best interests. However, it fails to do so and exposes their policyholder’s personal assets.

Here’s an example that we’ve seen happen. Let’s say Mary (the policyholder) blows through a stop sign in Chicago and hits Bob. Bob is transported to the hospital, where he’s treated for serious injuries to his spine and lower extremities. Soon after, Bob files a lawsuit in Cook County and names Mary as the defendant.

The plaintiff (Bob) offers to settle the car accident lawsuit for Mary’s policy limit of $300,000. Bob has over $750,000 in medical bills and will never walk again. However, Mary’s insurance company outright refuses to respond to the plaintiff’s reasonable offer of compromise. Instead, it delays settlement and waits for the other party to less for than the policy limit.

Before long, the lawsuit ends up in front of a Chicago jury. The jury listens to both sides as witnesses and experts take the stand. Ultimately, the jury awards Bob the plaintiff $1.25 million in monetary compensation for the damages he sustained as a result of the collision.

However, this award exceeds Mary’s policy limits of $300,000. Her personal assets have just been exposed. In this situation, Mary has the right to pursue a “failure-to-settle” bad faith insurance claim for the amount of the excess verdict. Her insurance company failed to settle the case before trial, despite fact that the plaintiff’s medical bills exceeded the amount of her policy limits. In short, Mary’s insurer failed to protect her financial assets.

You can also pursue a third-party claim against your insurance company if they mishandle a first-party bad faith claim. However, this doesn’t happen often.

ASSIGNMENT OF A BAD FAITH CLAIM IN ILLINOIS

Only a few states in America allow an injured third-party victim to file a bad faith lawsuit against the defendant’s insurance company. In Illinois, the policyholder can “assign” (or transfer) their right to pursue action against their insurance provider to the injured party.

In the example above, Mary (the policyholder) would exchange her rights to a bad faith claim with Bob the plaintiff, as long as Bob agrees not to execute judgment against Mary’s assets. This assignment can happen by a voluntary agreement between Mary and Bob. It can also be compelled by the court. After the assignment is complete, Mary (the third-party and injured driver) can now pursue a bad faith claim against Bob’s insurance company.

If you have been assigned a bad faith claim after an excess verdict, we can help. We’ve handled these types of claims in the past and successfully won on behalf of our injured clients. Call us today for a free consultation at (312) 578-9501.

What Benefits Can I Receive from an Illinois Insurance Bad Faith Lawsuit?

Bad faith insurance benefitsIf you have a first-party bad faith claim against your insurance company, you may recover the following benefits:

  • Your attorney’s fees;
  • Any costs related to your case; and
  • An additional award of up to $60,000.

In a third-party lawsuit, there are no limits to the amount you can be awarded. In a failure-to-settle claim, the policyholder typically recovers the amount of the excess verdict.

At the end of the day, the value of your case increases exponentially if you hire the right attorney. Our Illinois bad faith lawyers understand the stress you’re going through. We can help you navigate the situation, and take the stress of handling a bad faith claim off your shoulders.

How long do I have to file a bad faith insurance claim in Illinois?

You generally have two (2) years to file a bad faith claim in Illinois. The clock starts ticking from the date that the insurance company breached its duty of “good faith” or from the time when you discovered that coverage was denied.

It’s best to contact insurance bad faith lawyers like Shannon Law Group sooner rather than later. It sometimes takes months to investigate and prepare a bad faith lawsuit. Evidence supporting your claim may be harder to locate. So, don’t hesitate—contact us today.

Why Choose Shannon Law Group?

Play Video
Experience with Results

There's one thing you should know about us: We only take cases worthy of being tried in front of a jury. Because of this, we have the time, knowledge, and experience to go above and beyond for you - unlike other personal injury attorneys who have hundreds or thousands of cases. Our expert team will go out of their way to make sure you and your family are in the best position possible in the eyes of the law.

What's more, we have an inside scoop on the insurance industry. Before he represented injured people, lead attorney Joe Shannon represented corporations and their insurers. He sat on the other side of the table, so he knows what the insurance company will offer and what they won't offer. Since founding Shannon Law Group, Joe secured the largest verdict in Will County history and achieved other multi-figure settlements and verdicts in Illinois. 

As our satisfied clients can attest, we come through for them when they need it most. We take our responsibility to our clients seriously. We'll examine every angle of your case, and we promise to go the extra mile to get the compensation you deserve--not what the insurance company thinks your claim is worth.  Read our reviews and testimonials to see what other people have said about us.  

One-of-a-Kind Representation

Free Consultation Shannon Law GroupWhen you hire us to represent you after your insurance company acts in bad faith, you're helping yourself and your family. Why? Because our job is to bear the burden of dealing with insurance companies and their lawyers. Our bad faith insurance lawyers take those stressors off your shoulders, so you don't have to worry about them anymore.

We also understand the case isn't about us--it's about you. At Shannon Law Group, our top priority is to help you move forward toward a successful and secure future. Our Chicago attorneys will always put your interests first.

We'll get to know you personally, too. We'll come to your house and talk to your family.

You will never be treated like a transaction or a case at our law firm. When your case has resolved, our relationship doesn't end the moment we hand you a check. We'll stay in touch with you and help you and your family in whatever way we can. 

Keeping You in the Loop

We will always keep you updated on your bad faith insurance lawsuit. 

We'll make sure to return your call within 24 hours if you leave a message. If you have a question about your case, you will speak with the lawyer handling your case. No question is too big or too small for us.

If you believe you have a bad faith claim against an insurance company, our attorneys may be able to assist you. To get started, schedule your free consultation. Call us today at (312) 578-9501 or fill out the form at the bottom of this page. We look forward to speaking with you!

wHAT OTHERS ARE SAYING ABOUT SHANNON LAW GROUP
I have never been so impressed with a law firm. They answered all my questions and never gave up fighting for me all the way to my settlement. If they had not gotten the settlement, I still would give them 5 stars for just they way they treat their clients.

Thank you to all the people at Shannon Law
I’m incredibly grateful for the outstanding service I received from Shannon Law Group. From day one, they were fully committed to making sure my shoulder injury case was handled with care and professionalism. They worked tirelessly to ensure I received the justice I deserved, and their communication and dedication made a difficult time much more manageable. I’m so glad I was in contact with them from the very beginning. Highly recommend!

Thanks Rlanda Bellamy
I can't say enough about Shannon law group! Tom was was wonderful to work with! He was very polite and professional in handling my case! Always kept me updated and went out of his way to settle my case! I strongly reccomend Shannon law group! Thanks joe and your staff and a heartfelt thank you to tom for all your hard work! Best wishes! Sincerely David keifrider
I had an excellent experience working with attorney Jonathan J. Svitak at Shannon Law Group who provided an outstanding legal support after I suffered a serious shoulder injury from a flu shot. From the very beginning, Jonathan demonstrated a deep knowledge of the law, strong attention to detail and a genuine commitment to achieving the best possible outcome from my case . His professionalism, compassionate, and integrity made a stressful situation much more manageable. It was clear that he truly cared about my case and my well-being . He was always responsive to my questions and kept me informed throughout the entire legal process . I’m incredibly grateful for his help and highly recommend him and his entire team at Shannon Law Group. They all went above and beyond to provide exceptional legal representation.
Response from the owner:Hi Kala, thank you so much for taking the time to share your experience working with our team. It was a pleasure to represent you throughout your vaccine injury case. All our best to you and your family!
I had a vaccine injury (Frozen shoulder) in September 2022. I was googling the web to see if a flu shot can cause frozen shoulder. A slew of websites showing vaccine attorneys that could help file a claim. At first, I thought it was a joke but figured, what the heck, all I have is time, so why not look into it? So, I contacted three attorneys. Two said they could not help me, and Jonathan Svitak told me I would be happy to take your case, I am not afraid of a fight. Jonathan set up realistic schedules (Said it was about a three-year process) and kept me in the loop the whole way. As negotiations were under away, Jonathan and I communicated, and I gave him a figure I would be happy with. Jonathan not only got me that figure, but he got me more than that figure. Jonathan is not only a great attorney, but a caring individual as well. Several times on our calls he got to know me not only as client, but as a person as well.

Jonathan's paralegal Heather was always quick to answer my emails and was proactive in making sure I knew how the case was proceeding. I never felt out of the loop with Heather on my team.

To make matters even sweeter, the owner of the firm Joe Shannon called me himself to welcome me and tell me I was in good hands with Jonathan. We talked at least a 1/2 hour and shared about our lives and when he found out I was a foster parent, he shared about his family. Then in the mail, I received a card, with encouraging words and shared that he and his family would be praying for my family. WOW!! How amazing is that?

Also, on my birthday I was surprised to get a gift card from the firm saying happy birthday. Talk about customer service.

You can feel safe and secure in Shannon Law Group's hands, not only as a client but as a family too.

Oh, and my case was settled in 2 1/2 years. Six months earlier than anticipated.

Thank you, Jonathan, Joe and Heather, I appreciate you all.

Mariann Mattia
Response from the owner:Hi Mariann, thank you so much for taking the time to share your experience working with our team. What amazing feedback! It was a pleasure to represent you throughout your vaccine injury case. All our best to you and your family!
Jonathan Svitak was so helpful and always professional and very knowledgeable. Kept me informed all along the way while working on my case. I am very happy with Shannon Law Groups and all associates I had correspondence with.
Response from the owner:Hi Sandra, thank you so much for taking the time to share your experience working with our team. It was a pleasure to represent you throughout your vaccine injury case. All our best to you and your family!
My Mom had a reaction to her Vaccination shot and reached out to Shannon Law Group. Elizabeth Simek was the Lawyer that worked hard on my mom's case and made being a witness a seamless experience for me. Not only was she very Professional but she went above and beyond and made my Mom feel like a Celebrity. She listened to her every word and they became friends talking about life experiences.. Thanks Shannon Law Group and thanks again Elizabeth Simek for making this almost tragedy into a blessing in disguise. 5 Star above and beyond.
Response from the owner:Hi Chris, thank you so much for taking the time to share your experience working with our team throughout your mom's claim. It was a pleasure to represent her throughout her vaccine injury case. All our best to you, your mom, and your family!
Shannon Law group is outstanding, I contacted them about my vaccine injury and I was very skeptical. They put my mind to rest with their explanation of the injury and possible settlement.. I had to do very little legwork, once I got all my information to them they took the ball and did an outstanding job, they got me a very pleasant settlement to which I am very thankful. I highly recommend them for any of your vaccine injuries as they are very professional and get the job done., thank you again. Chuck Mountain Lake Mn.
Response from the owner:Hi Chuck, thank you so much for taking the time to share your experience working with our team. It was a pleasure to represent you throughout your vaccine injury case. All our best to you and your family!
I had a great experience with Shannon Law Firm handling my vaccine injury case. My attorney, Elizabeth Hess, was incredible- she stayed in regular contact with me, always kept me updated on the progress, and made sure I understood every step of the process. Her gentle tone, dedication, and professionalism truly stood out. I felt supported throughout the entire case. I highly recommend Shannon Law Firm to anyone in need of experienced and caring legal help.
Response from the owner:Hi Gail, thank you so much for taking the time to share your experience working with our team. It was a pleasure to represent you throughout your vaccine injury case. All our best to you and your family!
I had an excellent experience working with Shannon Law group and attorney Elizabeth Hess. She was so easy to work with and explained everything so I could understand it. I would recommend them to anyone.
Response from the owner:Hi Susan, thank you so much for taking the time to share your experience working with our team. It was a pleasure to represent you throughout your vaccine injury case. All our best to you and your family!