Over the last 25 years, courts have wrestled with the issue of whether to apply an absolute privilege to preclude bad-faith lawsuits based on an insurance company’s conduct during the litigation of an underlying first-party or third-party claim. Some courts still refuse to recognize a bad-faith claim against an insurance company based upon its post-litigation conduct. However, the prevailing trend seems to suggest that courts will find that some of the insurer’s conduct remains relevant and admissible, while the conduct of the insurer’s attorneys in defending the claim remains privileged.
Click the link on the right to download pdf