Can I assert a ‘bad faith’ claim on every type of insurance claim that I might present to an insurer?
No. Claims under many Group insurance policies providing employee benefits are subject to exclusive rights and remedies under Federal legislation (the Employee Retirement Income Security Act of 1974 "ERISA). Unfortunately for consumers, most "bad faith" rules developed by state courts simply do not apply. The more extensive damages usually recoverable in a bad faith case are basically precluded in an ERISA case, although the insurance company or plan may have to pay your attorneys fees if you are successful in an ERISA case.
However, do not take the insurer's mere assertion that the policy is "ERISA regulated" as gospel. Many policies which the insurer claims are ERISA plans are outside ERISA regulation. In such cases, contrary to the position often taken by the insurance company, bad faith rules and the extra-contractual damages available may indeed apply.
Many health insurance and HMO plans, and certain other policies require that disputed claims be subject to arbitration, and, as a result, a traditional lawsuit in a court seeking bad faith remedies may not be possible under such policies.
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