In Hackler v. State Farm Mut. Auto. Ins. Co., No. 3:14-cv-00531-MMD-VPC, 2016 WL 5402743 (D. Nev. September 26, 2016), the policyholder's underinsured motorist (UIM) claim was at issue. The insurance carrier took a long time to decide whether it would, or would not, pay the claim. The insurance carrier argued that its failure to deny the UIM claim was actually a defense to a bad faith claim. Undisputed evidence of this delay prevented the entry of summary judgment in the carrier's favor on the policyholder's claim for bad faith, however:
State Farm argues at length that Hackler cannot show bad faith because she cannot show a decision to deny benefits. (See ECF No. 55 at 4-5.) However, as courts in this district and elsewhere have recognized, sitting on a claim for an extended period is functionally equivalent to a denial. (Citations omitted.) As such, the Court finds State Farm's understanding of the requirements of showing bad faith needlessly narrow.
Hackler v. State Farm Mut. Auto. Ins. Co., No. 3:14-cv-00531-MMD-VPC, 2016 WL 5402743, at *4 (D. Nev. September 26, 2016).
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