Bad Faith Insurance Attorney for Property Claims

Founding attorney Peter Diiorio has pursued bad-faith claims against insurance companies on behalf of homeowners and business owners in Louisiana, Texas, Florida, and Colorado since 2005, limited to property claims. He has never represented an insurer. If the carrier is running out the clock on your hurricane, fire, storm, water, or hail claim, this page explains what that conduct is worth and how it gets proven.

Bad Faith Is Not the Same as a Denied Claim

Every bad-faith case begins with three questions, and they must be answered in order. First, what does the policy cover? That means reading the contract and establishing the cause and extent of the loss. Second, did the insurer breach the policy? An underpayment or wrongful denial is a breach of contract, and it can be remedied by a lawsuit under the policy without ever reaching bad faith.

Third, was the claim handling legally unreasonable? That is the bad faith question, and it is about the carrier’s conduct: what information it had, what it investigated, what contradictory evidence it received, and whether it responded when an error was pointed out.

Keeping the questions separate avoids two mistakes. The first is assuming every disagreement is misconduct. A denial, a low estimate, or a frustrating claim experience does not by itself establish bad faith, and a carrier that investigates reasonably and reaches a supported conclusion you disagree with has not acted in bad faith even if it is wrong. The second mistake is assuming eventual payment excuses an earlier unreasonable delay.

In Colorado, the Supreme Court’s decision in American Family v. Barriga holds that paying a benefit late does not erase the statutory delay penalty, and Louisiana’s penalty attaches to the failure to pay on time, regardless of whether the carrier pays later.

The honest sequence is this: establish the covered benefit, establish that the carrier did not pay it when it should have, and then establish that it had no reasonable basis for the delay or denial. The chronology of the file, not the size of the dispute, is what proves the third step.

Signs of Bad Faith

Each of the states we practice in has an unfair claims practices law, and the conduct they prohibit looks the same from state to state. The signs we see most:

• Delay without explanation. The carrier misses the statutory deadline to acknowledge, inspect, or pay or deny, and no one can say why.
• Repeated document requests. The same inventory, the same proof of loss, the same photographs requested a third time with no explanation of why the first two did not suffice.
• A new adjuster every few weeks. Each one starts over, and the file never moves.
• Misrepresented policy terms. A deadline, an exclusion, or a sublimit described in a way the policy does not support.
• No real investigation. A denial based on a drive-by, a desk review, or an engineer’s report written without opening the attic.
• A lowball with no basis. An estimate that omits obvious damage, or a settlement offer so far below the documented loss that it forces you to sue.
• “Final” and “full and final.” A payment labeled as closing the claim before the loss has been fully scoped, or a release slipped in with a partial check.
• Undisputed amounts withheld. The carrier disputes one part of the claim and holds the entire payment hostage to it.
• Blanket depreciation and unsupported reclassification. A flat percentage taken off everything, or wind recast as flood, with nothing in the file to support it.

Any one of these is a reason to look closer. A pattern of them, documented in a chronology, constitutes a bad-faith case.

What Bad Faith Is Worth in Each State

The remedies differ by state, and the differences are large enough to change how a case is handled. The examples below start from the same facts: a covered loss the carrier unreasonably underpaid by $100,000.

Louisiana

La. R.S. 22:1892, as rewritten by Act 3 of 2024, consolidated the state’s bad faith duties into a single statute effective July 1, 2024, and repealed the older law. An insurer that fails to pay within the statutory windows (30 days after satisfactory proof of loss for ordinary claims, or 60 days for residential and 90 days for commercial catastrophe losses) arbitrarily, capriciously, or without probable cause can owe a penalty of 50 percent of the unpaid amount, plus proven economic damages and reasonable attorney fees and costs.

The law states a $1,000 alternative minimum for ordinary claims where no partial payment has been made; R.S. 22:1892.2(B)(1) instead compares the 50 percent calculation plus proven economic damages with a $2,500 alternative minimum for qualifying catastrophe claims, using the unpaid balance when there was a timely partial payment.

On a $100,000 underpayment, that is $100,000 plus a $50,000 penalty plus documented economic damages such as loan interest or lost rent, plus fees. Louisiana does not allow punitive or general damages on a first-party property claim, and for catastrophe losses to immovable property, it requires a written cure notice and a 60-day cure period before suit.

Colorado

C.R.S. 10-3-1115 and 10-3-1116 allow a first-party policyholder whose covered benefit was unreasonably delayed or denied to recover two times the covered benefit, plus attorney fees and costs, in addition to the benefit itself. For a $100,000 benefit, that is $100,000 plus $200,000 plus fees, before interest. Under Barriga, the $200,000 award is not reduced if the carrier pays the $100,000 before trial.

The statutory claim does not require proof that the carrier knew its conduct was unreasonable; common-law bad faith does, and it can also award economic and noneconomic damages for the misconduct. Exemplary damages are available only for fraud, malice, or willful and wanton conduct, proven beyond a reasonable doubt, and are ordinarily capped at actual damages.

Florida

Fla. Stat. 624.155 permits a policyholder to sue an insurer that failed to attempt in good faith to settle a claim when it could and should have, but only after filing a civil remedy notice with the Department of Financial Services and giving the carrier 60 days to cure. If the carrier pays within 60 days, there is no bad-faith action.

Since the 2022 reforms, 624.1551 also requires the policyholder to establish that the carrier breached the policy before a bad faith claim can proceed, and payment of an appraisal award or acceptance of an offer of judgment does not count as that determination, though the gap between the carrier’s appraiser’s estimate and the award can be evidence. When a bad-faith claim succeeds, the policyholder recovers damages for the bad faith, which can exceed the policy benefits, plus attorney fees.

Texas

Chapter 541 of the Insurance Code prohibits unfair settlement practices and allows actual damages plus attorney fees, and up to three times actual damages when the carrier acted knowingly. The Prompt Payment of Claims Act adds interest on late-paid claims at 18 percent per year on most claims, or prime plus 5 percent on weather-related claims governed by Chapter 542A, plus fees.

On a $100,000 underpayment handled knowingly, the exposure is $100,000 plus up to $200,000 in additional damages, plus interest and fees. Chapter 542A requires written notice at least 61 days before suit on any claim arising from forces of nature.

What $100,000 of unreasonably withheld benefits can become, before interest and fees:

• Louisiana: $150,000 plus proven economic damages
• Colorado: $300,000
• Florida: $100,000 plus the damages the bad faith caused
• Texas: up to $300,000 for knowing conduct

These are illustrations of the arithmetic after liability and the covered amount are proven, not predictions. The covered benefit must be established first, and the carrier’s conduct must be shown to be unreasonable before any multiplier applies.

Fourteen Months in Lake Charles: A Case Illustration

In this scenario, the Trahans own a family restaurant in Lake Charles, Louisiana, insured under a commercial property policy with a $900,000 building limit and business interruption coverage. A Category 4 hurricane comes ashore in late August and takes most of the roof, the walk-in cooler, and the dining room ceiling. They report the loss two days later and submit a sworn proof of loss, a contractor’s $640,000 estimate, and twelve months of financial statements within six weeks.

The carrier pays $180,000 in October for the roof and describes it as an advance. Then the file stalls. A second adjuster takes over in December and asks for the financial statements again. A third takes over in March and asks for the contractor’s estimate again, and for a “detailed inventory” of kitchen equipment the Trahans had already provided. The business interruption claim is “under review” in every letter.

The Trahans borrow against their house to pay the contractor’s deposit so the restaurant can reopen, and the loan costs them $2,100 a month in interest.

The File

The Trahans keep cooperating, and it is easy to see why. Each new adjuster sounds like a fresh start, and each one says the file is almost complete. Filing a complaint feels like it would make an enemy of the people who hold the money. And every document request makes them wonder whether the delay is their fault, whether they missed something, whether a better-organized business would have been paid by now.

By the following October, fourteen months after the storm, the carrier has paid $180,000 on a $640,000 building loss and nothing on business interruption, and the Trahans have never received a written explanation of what is in dispute.

The Cure Notice

Lantern Law Group’s first step is the chronology: every letter, every request, every date the carrier received each document, laid out against the deadlines in La. R.S. 22:1892. The chronology shows that the carrier had satisfactory proof of loss for the building claim by mid-October of the first year, that the 90-day catastrophe window for commercial property closed in January, and that the interior scope was never disputed in writing by anyone.

It shows the financial statements were received twice. It shows no inspection notes supporting any reduction of the contractor’s estimate.

The firm sends the cure notice required by 22:1892.2 for catastrophe losses to immovable property, identifying the unpaid covered benefits, the dates, and the conduct, and giving the carrier its 60 days. It attaches the contractor’s estimate, an independent estimator’s review confirming it, a forensic accountant’s business interruption calculation of $210,000, and the loan statements documenting $29,400 in interest the delay has cost the Trahans.

The notice spells out the exposure: the $460,000 unpaid building balance and the $210,000 business interruption claim, a 50 percent penalty on the unreasonably withheld amounts, the proven economic damages, and attorney fees.

The carrier retains outside counsel, and the claim settles at mediation during the cure period for the building balance, the business interruption claim, the documented interest, and a negotiated penalty and fee component. The Trahans never file suit. What changed was not the loss, which was documented from the sixth week. What changed was that the carrier’s conduct, when weighed against the statute, carried a price.

This is a hypothetical illustration, not an account of a client matter. Results depend on the policy, the facts, and applicable law.

How to Pursue a Bad Faith Claim

A bad faith claim is built, not filed. The steps, in order:

• Policy and claim review. Establish what the policy covers, what the carrier has paid, and what remains owed. The covered benefit is the foundation; without it there is no bad faith claim.
• Evidence and chronology. Gather the policy, the loss report, inspection dates, every estimate and expert report, every payment letter, every request for information and your response, and the denial or reservation-of-rights letter. Build a chronology that shows when the carrier received each document and what it did next.
• Document the harm. Keep the consequences of the carrier’s conduct separate from the damage caused by the loss itself: loan interest, delayed repairs, lost rent or revenue, and the costs of the delay, each with proof and a causal explanation.
• Regulator complaint, when useful. A complaint to the state insurance department can prompt a response and create a record, but it cannot compel payment (see below).
• The statutory notice. Louisiana’s 60-day cure notice for catastrophe losses, Florida’s civil remedy notice through DFS with its 60-day cure, and Texas’s 61-day presuit notice under Chapter 542A are prerequisites, not formalities, and each must be done correctly.
• When the cure period runs and the carrier has not paid, sue on the policy and the bad faith claim together, or in the sequence the state requires.

Through it all, keep performing your own duties under the policy. A dispute does not excuse an inaccurate submission, a missed examination under oath, or a refusal to provide relevant information, and carriers use any lapse to argue the delay was yours.

Regulator Complaints: Useful, but They Cannot Make the Insurer Pay

Every state we practice in takes consumer complaints against insurers, and the complaints matter. The Louisiana Department of Insurance logged 1,497 complaints on the three 2020 hurricanes by April 2021 and recovered $41 million for consumers, with delay the top complaint early on and underpayment the top complaint later. Florida’s Department of Financial Services and the Colorado Division of Insurance run similar programs, and Texas’s Department of Insurance does as well.

What a complaint can do is prompt a written response, create a record of the carrier’s position, and in some cases trigger a market conduct review or a fine. What it cannot do is order the carrier to pay your claim, award penalties, or award fees. The regulator is not your lawyer and does not adjudicate your claim.

Filing a complaint is sometimes a useful step before suit, particularly in Louisiana, where a complaint and a cure notice can run in parallel, but it is not a substitute for the statutory notice, and it does not pause any deadline.

Examinations Under Oath and Reservation of Rights

Two letters tend to arrive when a carrier is preparing to deny. A reservation of rights letter states that the carrier continues to adjust the claim without conceding coverage and usually identifies the exclusions or conditions it may rely on. Read it carefully; it is the carrier’s own statement of the basis for its position, and it is the first exhibit in a bad faith case when the carrier later relies on something else.

An examination under oath is sworn testimony that the policy allows the carrier to take during its investigation, usually through its attorney, with a court reporter present. A demand for one is not proof the carrier has found anything, and it is not itself bad faith, but it is a reason to get counsel before the date rather than after. Sworn answers can affect coverage, and an inaccurate figure or an unexplained inconsistency will be cited later to dispute payment.

The right preparation is accurate records and truthful answers. In Colorado, C.R.S. 10-3-1118 requires written notice and an opportunity to cure before a carrier can rely on a failure-to-cooperate defense; in every state, simply refusing the examination hands the carrier the argument it wanted.

Deadlines for Bad Faith Claims

Louisiana’s penalty claim under 22:1892 is subject to a two-year prescriptive period, and Louisiana policies must give you at least two years from the date of loss to sue on the policy itself. For catastrophe losses to immovable property, the 60-day cure notice under 22:1892.2 must be sent, and the period must run before suit, so the notice must go out well before prescription.

Florida’s bad faith claim cannot proceed until the civil remedy notice has been filed with DFS and the 60-day cure period has run, and until the breach of the policy has been established, which in practice means the bad faith case often follows the coverage case rather than running alongside it. The underlying claim deadlines under 627.70132 (one year for notice, 18 months for supplemental claims) still control the coverage case.

Colorado’s common-law bad faith claim carries a two-year limitations period from accrual. For the statutory delay-or-denial claim, the Colorado Supreme Court has rejected the one-year limitations period for statutory penalties, but that decision does not permit waiting; accrual, which turns on when the unreasonable conduct and its harm were or should have been discovered, must be evaluated on a claim-specific basis. A homeowners policy cannot shorten the statutory period for suing the insurer.

Texas bad faith claims under Chapter 541 must be filed within two years of the unfair act, and Chapter 542A’s 61-day presuit notice must precede suit on any weather-related claim.

In every state, the safest assumption is that the bad faith clock started running the day the carrier first failed to do what the statute required, not the day you decided to call a lawyer.

How Lantern Pursues Bad Faith

Every case starts with a free policy and claim review. Peter reads the policy, the carrier’s estimates and letters, and the denial or reservation of rights, and tells you plainly whether a covered benefit is still owed and whether the carrier’s handling of it appears unreasonable. You do not need to decide whether to call it bad faith before you call. There is no cost and no obligation, and you speak with the attorney, not an intake desk.

If we take the case, we build two things at once: the evidence that the benefit is owed, with independent estimators, engineers, hygienists, and forensic accountants as the claim requires, and the chronology that shows what the carrier knew and when it knew it. We send the statutory notice the state requires, correctly, and we document the harm the delay has caused. Carriers know which policyholders’ lawyers will try a case, and every file in this firm is prepared as if it will go to trial. Peter’s published appellate win, Fiveash v. Pat O’Brien’s Bar, Inc., 201 So. 3d 912 (La. App. 4 Cir. 2016), turned on the kind of evidence fight a bad-faith case turns on.

Most claims resolve once the carrier sees the chronology and the exposure. Peter handles the negotiations and mediations himself. When a carrier still refuses to pay fairly, we litigate the policy claim and the bad-faith claim together, or in the sequence the state requires, and we pursue every penalty, multiplier, and fee award the statute allows.

Bad Faith Experience

Peter Diiorio has represented policyholders against insurance companies since 2005, beginning with roughly 150 New Orleans homeowners and business owners after Hurricane Katrina, and has never represented an insurance company or a corporation. Lantern Law Group and its predecessor firm, Gulf Coast Insurance Attorneys, have represented policyholders against State Farm, Allstate, USAA, Louisiana Citizens, Scottsdale, Allied Trust, Liberty Mutual, Chubb, Lloyd’s of London, and Wright National Flood, among others. Representative hurricane settlements are listed on our Hurricane Damage page.

Results depend on the facts, the policy, and applicable law. Past results do not guarantee a similar outcome.

Bad Faith Insurance Questions, Answered

What is bad faith insurance?

Bad faith is an insurer’s unreasonable delay, denial, or underpayment of a claim it owes, in violation of the duties state law imposes on it. It is separate from a breach of the policy: an underpayment is a breach; an underpayment with no reasonable basis, after the carrier had the evidence, is bad faith. The remedies for bad faith sit atop the claim itself.

How much can I sue an insurance company for in a bad faith case?

It depends on the state and on the covered benefit that was withheld. Louisiana adds a 50 percent penalty, proven economic damages, and fees. Colorado adds two times the covered benefit plus fees. Texas adds up to three times actual damages for knowing conduct, plus interest and fees. Florida allows damages for bad faith that can exceed the policy limits, plus fees. The covered benefit has to be proven first.

How much does a bad faith lawyer cost?

Nothing up front. We work on a contingency basis, so our fee comes only from a recovery we win for you, and we advance case costs. In Louisiana, Colorado, Texas, and in most Florida bad faith cases, the statutes also allow recovery of attorney fees from the carrier when the claim succeeds.

How do I file a bad faith claim against an insurance company?

Establish the covered benefit, build the chronology of the carrier’s conduct, document the harm the delay caused, send the notice your state requires (a cure notice in Louisiana, a civil remedy notice in Florida, a presuit notice in Texas), and sue if the carrier does not cure. Each step must be done correctly, and the notice requirements are where unrepresented policyholders most often lose their claims.

Is a denied claim bad faith?

Not by itself. A denial the carrier reached after a reasonable investigation and on a supported basis is a coverage dispute, and it is resolved by proving the loss is covered. A denial with no investigation, on a basis the file does not support, or one the carrier maintains after you have shown it is wrong, is where bad faith begins.

Can I sue in Louisiana without sending a cure notice?

For catastrophe losses to immovable property, no. La. R.S. 22:1892.2 requires a written cure notice and a 60-day cure period before suit. For other losses, the notice requirement does not apply, but the statutory penalty still depends on showing the carrier received satisfactory proof of loss and failed to pay within the statutory window without a reasonable basis.

What is a civil remedy notice in Florida?

A notice filed with the Florida Department of Financial Services under Fla. Stat. 624.155 that identifies the carrier’s violation and gives it 60 days to cure. If the carrier pays within 60 days, no bad-faith action can be brought. The notice has to state the specific facts and statutory provisions, and a defective notice does not start the clock.

Does Colorado’s two-times rule apply to my claim?

If you are a first-party policyholder (a homeowner or business owner claiming under your own policy) and the carrier delayed or denied a covered benefit without a reasonable basis, C.R.S. 10-3-1116 allows two times that benefit plus fees and costs. It applies to the benefit that was unreasonably withheld, not to the whole policy limit, and it is not reduced because the carrier eventually paid.

How long do I have to file a bad-faith claim?

Louisiana’s penalty claim and Colorado’s common-law claim each carry a two-year accrual period, and Texas allows two years from the unfair act. Florida’s claim cannot proceed until the notice-and-cure period has run and the breach has been established. In every state, the clock starts with the carrier’s conduct, not your decision to act, so have the file reviewed early.

What should I bring to a consultation?

Bring what you have. We can request the rest.

• Your policy and declarations page
• Every letter from the carrier, including the denial or reservation of rights
• The carrier’s estimates and payment records
• Your contractor’s and experts’ estimates and reports
• Every document request you received and what you sent in response, with dates
• Proof of the costs the delay has caused you, such as loan statements or lost rent

Start With a Free Policy Review

Tell us what happened and what the insurance company has said so far. Peter will review your policy and the carrier’s letters at no cost and give you a straight answer on whether a covered benefit is still owed and whether the carrier’s conduct appears unreasonable. The bad-faith clock started on the day the carrier first missed a deadline. Do not wait for it to decide for you.