The Courts have held that an insurer may breach its duty of good faith in many ways. A claim for bad faith generally arises out of the handling of some claim under the policy of insurance purchased by or for the benefit of the insured. The most common bad faith charges against insurers include failing to conduct an adequate investigation of a claim, exploiting the insured's vulnerable financial condition, and unnecessarily delaying the handling of a claim. An insurer who takes advantage of the insured's vulnerable position in order to force him to accept an unfair settlement of his claim is guilty of bad faith.

Recovery is allowed in bad faith cases for all economic harm caused by the insurer's conduct. In addition, punitive damages may be recovered against an insurer who breaches his duty of good faith in refusing to pay a claim upon proof of actual malice, fraud or insult on the part of the insurer. Since 1946, Kightlinger & Gray has been working with insurers, businesses and individuals on insurance issues, and has established a reputation as one of the nation’s leading insurance litigation firms.