I have written previously about “bad faith” as it pertains to an Arizona workers compensation claim. Insurance carriers have a duty to process a claim in “good faith”, which means that they cannot take any action which is arbitrary, capricious, or does not have a reasonable basis in fact. For example, a carrier cannot just deny a claim because they want to – they have to have a legitimate reason for doing so. A carrier that is found to have committed bad faith in a work injury claim in Arizona can be forced to pay a penalty of $500 or 25% of the amount in issue, whichever is greater.
Some of the more common examples of bad faith in Arizona work comp claims are carriers failing to pay compensation in a timely manner, carriers refusing to approve recommended medical care, and claim representatives having improper communications with a represented applicant. The Industrial Commission’s Claims Division, under the new leadership of attorney Melinda Poppe, seems to be taking legitimate complaints of bad faith and unfair claims processing seriously.
Chad Snow is a workers comp attorney in Arizona, with offices in Phoenix and Tucson. He can be reached at the firm’s website at Snow, Carpio, and Weekley.