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Insurance Bad Faith in New Mexico

Posted by Chance Gauthier | Apr 11, 2023 | 0 Comments

Insurance Bad Faith in New Mexico

New Mexico recognizes both first party and third-party bad faith claims. It is important to find a lawyer who understands the difference and understands your rights under the insurance policy and in the State of New Mexico. The lawyers at Gauthier & Maier Law Firm have experience both representing injured parties and insurance companies in bad faith lawsuits. The lawyers at Gauthier and Maier law utilize the skills and knowledge they received from representing insurance companies in defending insurance bad faith claims to help build and maximize your claim. Chance Gauthier and Shane Maier have gained an in depth understanding of Insurance Bad Faith and are available to speak with you about your potential bad faith claim.

First Party Bad Faith Claims

First party bad faith claims occur when an insurance company violates its promises to its policyholders or individuals covered under the policy. An insurance company issues an insurance policy in exchange for premiums paid by the policyholders. The policy is a legal promise to protect the policyholder and certain individuals, such as household members, from economic injury and harm. An insurance company owes several duties to its policyholders. The insurance companies act in bad faith when they breach those duties by failing to perform one or more of its mandatory duties to its insured. The following is a non-exhaustive list of certain duties an insurance company may breach:

  • Misrepresentation of policy provisions or pertinent coverage facts;
  • Failure to act with reasonable promptness in response to a claim;
  • Failure to adopt and implement reasonable standards for investigation of a claim;
  • Failure to approve or deny coverage of a claim;
  • Failure to settle a claim when liability is clearly established;
  • Failure to protect the assets of the policyholder being sued;
  • Attempting to settle a claim for less than the amount the policyholder is entitled or undervaluing a claim;
  • Abusing the arbitration process;
  • Unfairly raising premiums; wrongfully canceling, or failing to renew a policy;
  • Wrongfully cancels or fails to renew a policy;
  • Failure to defend an insured when being sued under the policy; and
  • And any other wrongful act under the policy.

The Gauthier and Maier Law Firm can evaluate insurance claim problems related to the many types of insurance coverage, including:

  • Casualty losses to fire, flood or storm damage under homeowners or farm and ranch policies;
  • Auto insurance property damage;
  • Uninsured and underinsured motorist coverage;
  • Liability insurance when someone sues you after an auto accident or injury on your property; and
  • Claims and benefits questions under policies of health care, disability or life insurance.

We would appreciate the opportunity to speak with you regarding your potential insurance bad faith claim.

Third Party Claims

New Mexico also narrowly recognizes third party Unfair Settlement Practice claims under what is called a Hovet claim. Hovet v. Allstate Ins. Co. is the landmark case where the New Mexico Supreme Court recognized third-party unfair settlement practices cause of action against third party insurers, 2004-NMSC-010, 135 N.M. 397 (2004). Under a Hovet claim, the New Mexico Supreme Court held that insurance companies providing motor vehicle insurance not only have a duty to their insured(s), but also have certain duties to third party victims injured by their insured(s). The Supreme Court in Hovet stated the legislative purpose of the Mandatory Financial Responsibility Act, which requires New Mexicans to buy motor vehicle insurance, is not only to protect insureds, but also to protect the public generally and innocent victims of automobile accidents. The injured claimants are beneficiaries under the policy and may sue the insurer for unfair settlement practices under the Insurance Code following a judgment.

There are certain conditions which must be met before an injured victim can pursue a claim against a third-party insurance company. If you believe you are being mistreated by an at fault party's insurance company it is important you contact an attorney who understands your rights and understands how to raise and prepare for a potential Hovet claim. The lawyers at the Gauthier & Maier Law firm have experience in handling Hovet claims and would be happy to provide a free consultation to discuss any issues you are concerned about.

Contact Experienced New Mexico Bad Faith Attorneys

New Mexico's laws can be challenging and complex, especially in regards to Insurance Bad Faith litigation. New Mexico's laws are very distinct from other States. The Gauthier and Maier Law Firm is a local New Mexico firm that practices primarily in New Mexico's courts. Contact a local experienced firm and ensure your legal rights are being protected by contacting the Gauthier and Maier Law Firm today at 505-226-0009. We look forward to visiting with you and helping you understand your rights.

About the Author

Chance Gauthier

Attorney Chance has the specialized knowledge and skill to handle even the most complex civil claims in the State of New Mexico. Chance had previously defended insurance companies and learned the ins and outs of the insurance industry. Chance now utilizes that insider knowledge to advance his injured clients claims and ensure his clients are being treated justly and fairly. For most of Chance's career he has devoted his time to helping injured victims throughout the State of New Mexico and is honored to have done so. As a New Mexico native, Chance takes great pride in representing New Mexico families and giving back to the New Mexico community where he grew up. If you have been injured or wronged in the State of New Mexico please contact Chance Gauthier with the Gauthier & Maier Law Firm for a free consultation at (505) 226-0009.


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