Colorado Insurance Litigation Lawyer
When you purchase an insurance policy in Colorado—whether it’s auto insurance, homeowners insurance, health insurance, or disability insurance—you’re entering into a contract. You pay your premiums faithfully, often for years, with the expectation that when you need coverage, your insurance company will be there to help. Unfortunately, insurance companies are for-profit businesses, and their financial interests sometimes conflict with their obligations to policyholders.
When an insurance company denies a valid claim, delays payment without justification, offers an unreasonably low settlement, or engages in other bad faith practices, you have legal rights. At Eddington Law, our Colorado insurance litigation attorneys have been fighting insurance companies for over 35 years, holding them accountable when they fail to honor their contractual obligations to policyholders.
We understand the frustration and financial stress that comes with insurance disputes. You paid for coverage, and you deserve to receive the benefits you’re entitled to under your policy. Our team has the experience, resources, and determination to take on even the largest insurance companies and win.
Understanding Insurance Bad Faith in Colorado
Under Colorado law, insurance companies have a duty to act in good faith when handling claims from their policyholders. This duty goes beyond simply following the letter of the insurance contract—it requires insurers to act fairly, honestly, and with reasonable diligence in investigating and processing claims.
What Constitutes Bad Faith?
Insurance bad faith occurs when an insurance company unreasonably denies, delays, or undervalues a legitimate claim. Colorado law recognizes both first-party bad faith (when your own insurance company mistreats you) and third-party bad faith (when another person’s insurer refuses to settle your claim fairly).
Examples of bad faith insurance practices include:
Unreasonable Claim Denials: Denying valid claims without proper investigation or reasonable basis, refusing to pay claims based on policy exclusions that don’t apply, or denying coverage without providing specific reasons or policy language supporting the denial.
Unjustified Delays: Taking an unreasonably long time to investigate claims, requesting unnecessary documentation repeatedly, failing to respond to communications in a timely manner, or deliberately stalling the claims process to pressure policyholders into accepting low settlements.
Lowball Settlement Offers: Offering settlements far below the actual value of the claim, refusing to consider all available evidence of damages, or pressuring injured policyholders to settle quickly before they understand the full extent of their injuries.
Inadequate Investigation: Failing to conduct a thorough investigation of the claim, refusing to interview important witnesses, ignoring evidence that supports the claim, or accepting the opposing party’s version of events without proper investigation.
Misrepresenting Policy Terms: Providing false information about coverage, failing to explain policy provisions clearly, or misrepresenting the terms of the policy to deny coverage.
Failure to Defend: Refusing to provide legal defense when the policy requires it, or failing to adequately defend the policyholder in a lawsuit covered by the policy.
Types of Insurance Disputes We Handle
Our Colorado insurance litigation attorneys handle disputes involving all types of insurance policies.
Auto Insurance Disputes
Car accident claims often involve insurance disputes when insurers try to minimize their payouts:
- Denials of uninsured/underinsured motorist (UM/UIM) claims
- Disputes over policy limits and coverage amounts
- Bad faith refusal to settle third-party claims within policy limits
- Medical payment coverage denials
- Disputes over rental car coverage or towing reimbursement
- Total loss valuation disputes when insurers undervalue your vehicle
Homeowners Insurance Claims
Colorado homeowners face unique challenges from hail damage, wildfires, and other natural disasters:
- Hail damage claim denials despite visible damage
- Wildfire damage coverage disputes
- Water damage and mold claim denials
- Wind damage claim disputes
- Roof replacement coverage issues
- Personal property loss claims
- Additional living expense disputes when your home is uninhabitable
- Coverage disputes over the age of your roof or prior damage
Health Insurance Disputes
Health insurance companies sometimes deny coverage for medically necessary treatments:
- Denial of coverage for prescribed treatments or procedures
- Disputes over experimental or investigational treatment exclusions
- Pre-authorization denials
- Out-of-network coverage disputes
- Disputes over medical necessity determinations
- Policy rescission cases where insurers try to cancel your policy retroactively
Disability Insurance Claims
Both short-term and long-term disability insurers frequently deny legitimate claims:
- Denial of disability benefits despite medical documentation
- Termination of benefits before maximum duration
- Disputes over the definition of “disability” under the policy
- Bad faith surveillance and investigation tactics
- Failure to reasonably accommodate return-to-work attempts
- Disputes over occupational vs. any occupation disability definitions
Life Insurance Disputes
Beneficiaries sometimes face obstacles when trying to collect life insurance proceeds:
- Denial of claims based on alleged material misrepresentation on the application
- Disputes over cause of death and policy exclusions
- Contestability period disputes
- Beneficiary disputes
- Delayed payment without reasonable cause
Business Insurance Claims
Colorado businesses depend on insurance to protect their operations:
- Business interruption claim denials
- Commercial property damage disputes
- Liability coverage disputes
- Workers’ compensation insurance disputes
- Professional liability claim handling issues
- Cyber insurance claim denials
Common Tactics Insurance Companies Use
Insurance companies employ various strategies to minimize claim payouts. Understanding these tactics helps you recognize when you’re being treated unfairly.
The Delay Game
Insurance companies know that financial pressure increases over time. By delaying claim processing, they hope you’ll become desperate and accept whatever they offer. They may request the same documents multiple times, claim they never received paperwork, assign inexperienced adjusters who take forever to make decisions, or simply fail to return phone calls and emails.
Lowball Initial Offers
Adjusters often make unreasonably low initial settlement offers, hoping you don’t know the true value of your claim. They may ignore significant damages, fail to account for future medical expenses, or refuse to consider non-economic damages like pain and suffering.
Twisting Your Words
Insurance adjusters may use recorded statements against you, taking statements out of context to support a denial, or asking leading questions designed to elicit responses that undermine your claim.
Surveillance and Investigation Abuse
While insurers have the right to investigate claims, some cross the line into harassment. They may use surveillance footage selectively to misrepresent your condition, hire investigators who engage in aggressive tactics, or demand unreasonable amounts of medical records and documentation.
Policy Interpretation Games
Insurance policies can be complex, and insurers sometimes interpret ambiguous language in their favor rather than the policyholder’s favor—despite legal principles that require ambiguities to be resolved in favor of coverage.
Intimidation and Pressure
Some insurance companies use aggressive tactics to discourage policyholders from pursuing valid claims, threatening litigation if you don’t accept their offer, suggesting that hiring an attorney will delay your claim, or implying that you’re committing fraud for asserting your rights under the policy.
Colorado Insurance Laws That Protect Policyholders
Colorado has strong laws protecting insurance consumers from unfair practices.
Colorado Revised Statutes § 10-3-1115 and 1116
These statutes outline unfair claims settlement practices and establish penalties for insurance companies that engage in bad faith conduct. They require insurers to acknowledge claims promptly, conduct reasonable investigations, provide clear explanations for claim denials, and respond to communications in a timely manner.
Unreasonable Delay or Denial
Colorado law allows policyholders to recover not just the benefits owed under the policy, but also additional damages when insurers act unreasonably. This includes delay damages (two years of insurance benefits or $500, whichever is greater) if your claim is unreasonably delayed, and attorney fees and court costs if you must file suit to recover benefits.
The Reasonableness Standard
Colorado courts apply a reasonableness standard to insurer conduct. Even if an insurer ultimately has a legitimate reason to deny a claim, the manner in which they investigate and process the claim must be reasonable. Insurers cannot rely on questionable medical opinions, ignore credible evidence, or conduct one-sided investigations.
ERISA Considerations
Many employer-sponsored disability and health insurance plans are governed by federal ERISA law rather than state law. ERISA claims have different procedural requirements and remedies. Our attorneys are experienced in both state and federal insurance litigation.
The Insurance Claims Process in Colorado
Understanding the proper claims process helps you identify when an insurer is acting in bad faith.
Filing Your Claim
Most insurance policies require prompt notice of a loss or injury. You should:
- Report the incident to your insurance company as soon as possible
- Document everything related to your loss with photos, receipts, and records
- Keep copies of all documents you submit to the insurance company
- Maintain detailed notes of all communications with insurance representatives
- Review your policy carefully to understand your coverage and obligations
The Investigation Phase
After you file a claim, the insurance company will investigate. This may involve:
- Assigning a claims adjuster to your case
- Inspecting damaged property
- Reviewing medical records and bills
- Taking statements from you and witnesses
- Consulting with experts about damages or liability
A reasonable investigation should be thorough but completed in a timely manner. Excessive delays or one-sided investigations may constitute bad faith.
The Decision
Once the investigation is complete, the insurer must make a decision about your claim. Colorado law requires insurers to:
- Provide a clear explanation if denying or partially denying your claim
- Cite specific policy language supporting their decision
- Offer payment promptly if approving the claim
- Explain your appeal rights if you disagree with the decision
The Appeals Process
If your claim is denied or you disagree with the settlement offer, most policies allow you to appeal. However, you’re not required to exhaust internal appeal processes before consulting an attorney or taking legal action.
How Eddington Law Fights Insurance Companies
When insurance companies act in bad faith, we take aggressive action to protect your rights.
Comprehensive File Review
We begin by thoroughly reviewing your insurance policy, all communications with the insurance company, claim documents, and the insurer’s file (which we can obtain through litigation if necessary). This review helps us identify specific instances of bad faith conduct.
Independent Investigation
We don’t rely on the insurance company’s investigation. We conduct our own independent investigation, which may include:
- Hiring experts to evaluate property damage, medical conditions, or other relevant issues
- Interviewing witnesses the insurance company ignored
- Gathering evidence the insurer failed to consider
- Documenting the full extent of your damages
Demand and Negotiation
We prepare detailed demand letters that clearly explain why the insurance company must honor its obligations. Our letters reference specific policy language, present compelling evidence, cite relevant Colorado law, and demand full payment of benefits plus penalties for bad faith conduct.
Many insurance disputes can be resolved at this stage when insurers realize they’re dealing with experienced counsel who will take the case to trial if necessary.
Litigation When Necessary
Insurance companies respect attorneys who are willing and able to try cases. When negotiation fails, we file lawsuits and aggressively pursue your case through trial. Our litigation strategy includes:
- Filing breach of contract and bad faith claims
- Conducting extensive discovery to uncover the insurance company’s wrongful conduct
- Deposing company representatives and decision-makers
- Using expert witnesses to establish the insurer’s unreasonable conduct
- Seeking all available damages including policy benefits, consequential damages, delay damages, and attorney fees
Holding Insurers Accountable
We believe insurance companies must be held accountable when they act in bad faith. Our firm has a strong track record of recovering full compensation for policyholders, including:
- All benefits owed under the policy
- Consequential damages caused by the denial (additional medical expenses, lost income, etc.)
- Delay damages as provided by Colorado law
- Attorney fees and costs
- In egregious cases, punitive damages to punish the insurer’s misconduct
Why Insurance Disputes Require Experienced Legal Counsel
Insurance litigation is a specialized area of law that requires specific knowledge and experience.
Understanding Complex Policies
Insurance policies are contracts, but they’re written in technical language that can be difficult to understand. Our attorneys know how to interpret policy language and understand the legal principles that govern insurance coverage disputes.
Knowing Insurance Industry Tactics
We’ve been fighting insurance companies for over 35 years. We understand their tactics, strategies, and standard practices. This knowledge allows us to anticipate their arguments and counter them effectively.
Resources to Take on Large Insurers
Insurance companies have vast resources and experienced attorneys. Successfully litigating against them requires financial resources to hire experts, conduct thorough discovery, and pursue cases through trial. We have these resources and aren’t intimidated by large insurance companies.
Experience Makes the Difference
Insurance litigation involves unique procedural rules, specialized legal theories, and industry-specific knowledge. Our decades of experience give us insight into what works and what doesn’t when fighting insurance companies.
When to Contact an Insurance Litigation Attorney
You should consider contacting an attorney if you experience any of the following:
- Your claim has been denied without clear explanation or reasonable basis
- The insurance company is taking an unreasonably long time to process your claim
- You’ve been offered a settlement that seems far too low
- The insurance adjuster is pressuring you to settle quickly
- The insurer is requesting the same information repeatedly or making unreasonable document demands
- Your claim has been partially denied without adequate explanation
- The insurance company is not returning your calls or responding to communications
- You’re being treated unfairly or disrespectfully by the insurance company
- The insurer has hired investigators or surveillance companies to follow you
- Your policy was cancelled or rescinded after you filed a claim
Early involvement of an attorney can often resolve disputes more quickly and efficiently than waiting until the situation escalates.
What to Expect When Working with Eddington Law
When you hire Eddington Law to handle your insurance dispute, you become part of our family. We provide the personalized attention you deserve while leveraging our extensive experience and resources.
Free Initial Consultation
We offer free consultations to review your insurance dispute. During this meeting, we’ll:
- Listen to your story and review your documentation
- Explain your legal rights and options
- Provide our honest assessment of your case
- Answer all your questions about the process
- Explain our fee structure (we work on contingency in most insurance cases)
Clear Communication
Insurance disputes can be confusing and frustrating. We explain everything in plain language and keep you informed throughout the process. You’ll have direct access to your attorney, and we return calls and emails promptly.
Aggressive Representation
While we treat you with compassion and respect, we’re aggressive in dealing with insurance companies. We won’t be intimidated, and we won’t settle for less than you deserve.
No Upfront Costs
We handle most insurance litigation cases on a contingency fee basis. This means:
- No attorney fees unless we recover compensation for you
- We advance all costs of litigation
- You can afford experienced representation regardless of your financial situation
- We’re motivated to maximize your recovery
Common Questions About Colorado Insurance Litigation
How long do I have to file a lawsuit against my insurance company?
Colorado’s statute of limitations for breach of contract claims is generally three years from the date of the breach. However, various factors can affect this deadline, so it’s important to consult with an attorney as soon as possible after your claim is denied or delayed.
Can I sue my insurance company even if they eventually paid my claim?
Yes. If your insurance company unreasonably delayed payment, forcing you to incur additional expenses or damages, you may be entitled to consequential damages and attorney fees even if they eventually paid the policy benefits.
What if my insurance company says I violated the policy terms?
Insurance companies often claim policy violations to avoid paying claims. We carefully review these allegations and often find they’re unsupported or the alleged violation doesn’t actually justify denial under Colorado law.
Will filing a lawsuit make my insurance premiums go up?
Your premiums should not increase simply because you filed a lawsuit to recover benefits you’re entitled to under your policy. However, depending on the type of claim, your insurer may choose not to renew your policy at the end of the term.
What’s the difference between my insurance company and a third-party insurer?
Your insurance company (first-party insurer) owes you a duty of good faith. A third-party insurer (the insurance company for someone who injured you) has different obligations but can still act in bad faith by unreasonably refusing to settle claims within policy limits.
Do I have to accept the insurance company’s settlement offer?
Absolutely not. You’re never required to accept an offer you believe is inadequate. Once you accept a settlement and sign a release, however, you typically cannot pursue additional compensation, so it’s important to fully understand your damages before settling.
Can the insurance company cancel my policy after I file a claim?
Colorado law prohibits insurers from canceling policies solely because you filed a claim. However, they may choose not to renew your policy at the end of the term, or they may cancel for other legitimate reasons like non-payment of premiums.
What if I have an ERISA health or disability plan through my employer?
ERISA plans have different procedural requirements and remedies than traditional insurance policies. It’s crucial to work with an attorney experienced in ERISA litigation, as failing to follow ERISA procedures can harm your case.
Why Choose Eddington Law for Your Insurance Dispute
When you’re fighting an insurance company, you need an attorney with the experience, resources, and determination to win.
Over 35 Years Fighting Insurance Companies
Since 1984, we’ve been holding insurance companies accountable in Colorado. Our deep understanding of Colorado insurance law, local courts, and insurance industry practices gives our clients a significant advantage.
Proven Track Record
We’ve successfully recovered millions of dollars for Colorado policyholders in insurance disputes. Our reputation for aggressive advocacy and willingness to try cases often leads insurance companies to make fair settlement offers rather than face us in court.
Personalized Attention
While we have the resources to take on major insurance companies, we provide the personalized attention of a family practice. You’ll work directly with experienced attorneys who genuinely care about your case and your recovery.
No Fees Unless We Win
We handle insurance litigation on a contingency fee basis. You pay no attorney fees unless we recover compensation for you. This means everyone has access to quality legal representation when fighting insurance companies.
Aggressive Advocacy
Insurance companies have aggressive attorneys protecting their interests. You need the same level of advocacy protecting yours. We’re not afraid to take cases to trial when insurers refuse to act reasonably.
Statewide Representation
With offices in Denver and Steamboat Springs, we serve insurance dispute clients throughout Colorado—from the Front Range to the Western Slope and everywhere in between.
Take Action Against Insurance Bad Faith
If you or a loved one has been injured in a car accident anywhere in Colorado, don’t wait to get the legal help you need and deserve. The attorneys at Eddington Law are ready to evaluate your case, explain your rights, and fight for the maximum compensation you’re entitled to receive.
Your consultation is completely free, and we never charge attorney fees unless we successfully recover compensation for you. We serve clients throughout Colorado, including Denver, Steamboat Springs, Colorado Springs, Boulder, Fort Collins, Aurora, and surrounding communities.
Contact Eddington Law today:
- Call (303) 815-1585
- Visit our website at eddington.law
- Stop by our Denver or Steamboat Springs office
Don’t let another day go by without taking action. Let our experienced Colorado car accident attorneys fight for the justice and compensation you deserve.
Eddington Law – Serving Colorado’s Injured Families Since 1984