Schlusselberg v. New York Cent. Mut. Fire Ins. Co., No. 2019-11765, 2022 WL 1760185, (N.Y. App. Div. Jun. 1, 2022)

NY Supreme Court Appellate Division explains that failure to pay policy limits by insurance company does not constitute bad faith.

After the plaintiff was hit by a vehicle while crossing the street, she filed an action against the tortfeasor and settled the matter for the $25,000 policy limits. The plaintiff then filed an action against her UIM insurer to recover the remaining $225,000 from her policy limits. She alleged a breach of contract claim and asked for punitive damages, claiming the company acted in bad faith. The court determined that the plaintiff failed to meet her burden as she did not allege an independent tort, the conduct by the insurer was not a gross disregard of the insured’s interest, did not establish that the insurance company’s conduct was of an egregious nature, and did not establish that the actions of the defendant were a pattern directed to the general public. The courts ruling solidifies that simply not providing a plaintiff with an offer that they desire does not mean the insurance company acted in bad faith.


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