How to Sue Your Insurance Company for Bad Faith in California

By Timothy Hobbs

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Insurance

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Last Modified on Jan 22, 2026

The reason you pay for insurance is to have protection when you need it. At least, that’s how insurance policies are supposed to work. Far too often, insurers act in bad faith, denying, undervaluing, or delaying payment on valid claims. Knowing how to sue your insurance company for bad faith in California can enable you to protect your rights and access the benefits that you rightfully deserve.

What Does It Mean When an Insurer Acts in Bad Faith?

For an insurer to act in bad faith means they are unfairly and unreasonably delaying, denying, or undervaluing a valid claim. It isn’t always easy to identify when an insurance company is acting in bad faith, either. An adjuster may give excuses for the delays or try to explain undervaluation with complicated jargon meant to confuse you. That’s why it’s wise to work with an experienced Los Angeles bad faith insurance attorney. Hobbs Law Group knows how to spot these tactics.

California Laws on Bad Faith Insurance

California has numerous laws in place to prevent insurers from acting in bad faith. These laws and regulations require them to handle claims quickly and effectively. After filing a claim, the insurer has 15 days to acknowledge the claim, request documentation, and begin investigating. After receiving proof of loss, the insurer has 40 days to approve or deny the claim. Within 30 days of approval, they must pay out the claim. If there are any reasonable delays, the insurer must provide a notice explaining why every 30 days.

How to Prove That an Insurance Company Acted in Bad Faith in California?

In 2023, there were 7,384 complaints to California’s Insurance Commissioner, highlighting how often insurance companies may act in bad faith. To prove that an insurer acted in bad faith, you must show how they unreasonably undervalued, delayed, or denied a valid claim. Doing this can be difficult, but a California insurance bad faith attorney knows how to build a compelling case. Your attorney can launch their own investigation into the incident, consulting medical practitioners and other professionals.

It’s important to keep detailed documentation of all correspondence with your insurer and request written notices of any delays or denials. This can serve as evidence when it comes time to take your insurance bad faith case to court. Also, keep a journal detailing how the insurer’s actions have negatively impacted your life. You can pursue damages for pain and suffering as part of your compensation, and this type of evidence can prove that.

About Hobbs Law Group

At Hobbs Law Group, we know how important insurance benefits can be for you and your family. That’s why we treat every case with the compassion and dedication it deserves. We can make you feel heard throughout the process, keeping you involved in all decision-making. We also know that insurance companies care more about their bottom line than paying out on a valid claim. Insurers need to be held accountable, and that’s what we’re here to do.

We’ve secured numerous multimillion-dollar verdicts for our clients against some of the biggest insurance companies in the country. Policyholders in California recovered over $133 million from insurers in 2023, and we can pursue the compensation you deserve for your losses. California’s insurance bad faith laws can be complicated, so you want an experienced attorney with a successful record to guide you through the process.

FAQs

What Are Three Ways in Which an Insurer Can Be Liable for Bad Faith in California?

Three ways your insurer can be liable for bad faith include:

1. Unreasonably delaying a claim
2. Unfairly denying a claim
3. Delaying payments for an approved claim

California law sets specific deadlines for an insurance company to acknowledge a claim, investigate it, approve or deny it, and then pay out if approved. Failure to meet these deadlines can result in an insurer being liable for bad faith.

How Do You Prove Bad Faith by an Insurance Company in California?

To prove bad faith by an insurance company in California, you must show that they’ve unreasonably delayed, denied, or undervalued a valid claim. That means you need evidence that:

• Your claim is covered by your policy.
• You followed policy rules for reporting the incident.
• You’ve provided any necessary documents for the insurance company to make a decision.

You may also need to prove the true value of your damages to show how your claim was undervalued.

What Damages Can You Recover for Bad Faith Insurance in California?

Damages you can recover for bad faith insurance in California include:

• Policy benefits that were due to you, plus interest
• Consequential damages
• Sometimes, punitive damages

Consequential damages include financial losses you incurred as a result of the insurer’s actions, emotional distress, pain and suffering, and attorney fees. If the insurer acted particularly egregiously, a judge may impose punitive damages to punish them further.

Is It Worth Filing a Claim Against an Insurance Company?

Yes, it’s often worth filing a claim against an insurance company when they act in bad faith. You’ve been a loyal policyholder, so you deserve access to the benefits you’ve been paying for. A civil claim allows you to recover the policy benefits you were entitled to, interest, and additional costs you’ve incurred. Moreover, filing a claim shows an insurance company that policyholders will not stand by and allow them to act in bad faith.

Hire an Insurance Bad Faith Lawyer From Hobbs Law Group

When an insurer fails to fulfill contractual obligations in good faith, you shouldn’t have to suffer the consequences. Hire an insurance bad faith lawyer to prove that the insurer is violating their duties and pursue the compensation you deserve. An attorney can investigate to determine the value of your claim, negotiate with the insurer to get them to honor your policy, and represent you in court to pursue the benefits you’re entitled to.

Contact Hobbs Law Group today to schedule a consultation about your insurance bad faith case. We can listen to you and strategize the strongest means forward. Don’t let the insurance company take advantage of you. Reach out to our team and take the first steps toward compensation.

*Previous case results do not guarantee similar outcomes in your case.