Running a business in Lancaster County means carrying the right commercial insurance; this means property, business interruption, and commercial general liability coverage to protect against the unexpected. When an insurer wrongfully delays or denies a valid commercial claim, it can put a business’s payroll, inventory, and future at risk. Our bad-faith insurance attorneys at HGSK Law Firm represent Lancaster-area business owners who paid for coverage and were wrongfully denied the benefits they are owed.
Commercial Insurance Denials in Lancaster County
From the restaurants and retail shops along North Queen Street to the manufacturers, warehouses, and production facilities along the Route 30 and Route 222 corridors, Lancaster County businesses rely on commercial policies to keep operating after a fire, storm, theft, or equipment failure. When those claims are denied outright, delayed for months, or paid only in part, our attorneys step in to hold the insurance company accountable under Pennsylvania’s bad-faith insurance statute (42 Pa.C.S.A. § 8371).
Common Reasons Commercial Claims Are Denied
Insurance carriers cite a range of justifications when refusing to pay a commercial claim, including:
- Alleged late notice of the loss
- Disputes over whether damage was caused by a covered peril or ordinary wear and tear
- Disagreements over the value of damaged inventory, equipment, or property
- Denial of business interruption or lost income claims for lack of “direct physical loss”
- Reliance on policy exclusions without a full investigation
Many of these denials do not hold up once the policy language and the facts of the loss are examined closely.
Signs an Insurer May Be Acting in Bad Faith
A denial or delay is not automatically bad faith, but certain patterns raise concern, such as:
- Failing to inspect the property or interview witnesses promptly
- Ignoring favorable findings from the business’s own engineer or contractor
- Offering a settlement far below the documented loss
- Shifting the stated reason for denial over time
- Going silent for extended periods without communication
Under the two-part test set out by the Pennsylvania Supreme Court in Rancosky v. Washington National Insurance Co., 170 A.3d 364 (Pa. 2017), a business must show:
- The insurer lacked a reasonable basis for denying the claim, and
- The insurer knew or recklessly disregarded that lack of a reasonable basis
What Compensation May Be Available in Lancaster Bad Faith Insurance Claims?
If a bad faith claim is successful, Pennsylvania law allows for recovery of:
- Interest on the unpaid claim
- Punitive damages against the insurer
- Attorney’s fees
- Court costs
Businesses can also recover consequential damages tied to the financial fallout of the denial, such as lost income or additional costs incurred while the claim went unpaid.
Talk to a Lancaster Commercial Insurance Denial Attorney
Bad-faith commercial insurance cases are fact-intensive, and insurers often have significant resources behind their denial decisions. Our firm has represented Lancaster policyholders for decades, and we take the time to review policy language, correspondence, and the insurer’s claims file to determine whether a denial was reasonable or whether it crossed the line into bad faith.
If your Lancaster-area business had a commercial insurance claim denied, delayed, or underpaid, call HGSK Law Firm at 267-551-8782 or contact us online for a free case evaluation.