Blog

A federal judge recently granted Plaintiff’s motion for partial summary judgment finding that ACE American Insurance Company (“ACE”) breached its duty of good faith and fair dealing after its claims handler failed to issue retroactive payments in a timely manner even after discovering her miscalculations.

On March 13, 2012, our client fell on a cement surface at work, injuring her head and knee. At the time she worked for the Boeing Company. Boeing contracted with ACE to insure Boeing’s employees receive workers’ compensation. ACE’s assigned adjuster greatly miscalculated our client’s wage replacement benefits, underpaying Plaintiff by over $23,000 in benefits.

The adjuster considered her error an “honest mistake,” but failed to correct the issue even after the Industrial Commission of Arizona (“ICA”) required our client be paid the proper amount, “immediately.” Months later the adjuster received emails from Plaintiff’s legal representatives asking for wage correction, but after again promising to pay benefits in short-time, ACE’s adjuster waited another 9 months before correcting her errors.

The federal judge found there is no genuine issue of material fact as to whether the adjuster’s improper claims handling actions occurred and were intentional. He also noted that findings of bad faith require that the unreasonable conduct includes failure to “immediately conduct an adequate investigation,” failure to “act promptly in paying a legitimate claim,” and “forcing an insured to go through needless adversarial hoops to achieve its rights under the policy.”

The judge determined the adjuster’s conduct meets each qualification. Also, because the Defendants didn’t disputed that our client was owed retroactive payments, the Judge found the insurance claim isn’t “fairly debatable.”

The experienced worker’s compensation lawyers of Doyle LLP are pleased with this result and honored to represent the client in this dispute.