These days, everyone is familiar with insurance companies trying to do whatever they can, legally or illegally, in order to avoid or reduce benefit payouts.

Oftentimes, though, when the actual details of how insurance companies attempt to avoid paying are presented to a jury, they react with horror.

In one recent bad faith insurance lawsuit, which involves a disability claim that has been ongoing since 1998, an insurance consumer was awarded with more than $7 million (plus attorney fees and court costs) after receiving an initial $3.1 million disability verdict back in 2003.

The case in question involved an attorney who was hit by a bus back in 1998, and his multi-year battle with AIG, who not only lied and claimed that he was drunk and leaped out into traffic, but also coached the bus driver in how he should change his story about what really happened.

The disabled party ended up receiving a verdict of $3.1 million in benefits for his disability claim as a result of the lawsuit, which the jury reduced to $2.2 million for comparative fault because they agreed with AIG’s false version of events. However, the reduction was not enough for AIG, so it ended up appealing the case. AIG’s appeal successfully delayed the case for years. However, in 2008, the appeals court upheld the full $3.1 million verdict.

At that point, the insurance consumer filed a bad faith lawsuit against AIG for its underhanded tactics.

During the bad faith lawsuit, the judge found that AIG not only fabricated a completely false (but more believable) version of the accident, but also suppressed evidence that would have worked against them. In addition, AIG staged a mock deposition for the bus driver, training him in how he should respond with his modified testimony. “This is an egregious case,” the judge wrote. “The unfair claims settlement practices that AIGCS and AIGTS committed in their dealings with the Andersons were not mere oversights. They were deliberate or callously indifferent acts designed to conceal the truth, improperly skew the legal system and deprive the Andersons of fair compensation for their injuries for almost a decade.”

As a result of AIG’s underhanded attempt to avoid paying a legitimate disability claim, AIG ended up paying out well over 3 times what the initial disability benefits should have been.

Source: http://www.lawyersandsettlements.com/articles/california-insurance/california-insurance-law-denied-disability-28-19705.html