Bad Faith Claims Increasing in Connecticut for UM/UIM Complaints

Elizabeth O. Hoff, Associate, and Melicent B. Thompson, Partner, at Gfeller Laurie, LLP. 

Claims for breach of the covenant of good faith and fair dealing (“common law bad faith”) have been appearing more frequently in Connecticut complaints for uninsured/underinsured motorist coverage. Connecticut courts generally have not been receptive, often striking such claims at the pleading stage, especially where they merely describe a dispute over coverage. This is noteworthy given that more recently, some Connecticut courts also have begun applying a less stringent standard for pleading bad faith. Here we discuss this trend and Connecticut courts’ treatment of these claims at the pleading stage, demonstrating that carriers are best positioned to avoid common law bad faith claims in the uninsured/underinsured motorist context by employing procedures that ensure timely and thorough investigation and documentation of claims and timely, clear and direct communication with claimants regarding the bases for the insurer’s coverage position.

In Connecticut, bad faith requires actual or constructive fraud, a design to mislead or deceive, or a neglect or refusal to fulfill some duty or contractual obligation, not prompted by an honest mistake but by interested or sinister motive. See De La Concha of Hartford, Inc. v. Aetna Life Ins. Co., 269 Conn. 424, 433 (2004). A bad faith claimant must plead three essential elements: (1) plaintiff and defendant were parties to a contract under which plaintiff reasonably expected to receive certain benefits; (2) defendant engaged in conduct that injured plaintiff’s right to receive some or all of those benefits; and (3) defendant acted in bad faith. See Tarabek v. Hartford Ins. Co., No. 561153, 2002 WL 31172957, at *2 (Conn. Super. Ct. Aug. 26, 2002).