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Does the threat of insurer liability for "Bad Faith" affect insurance settlements?

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1001 ‎$0‎MAPA20140008025‎$a‎Asmat, Danial P.
24510‎$a‎Does the threat of insurer liability for "Bad Faith" affect insurance settlements?‎$c‎Danial P. Asmat, Sharon Tennyson
520  ‎$a‎Economic reasoning predicts that policyholders in states that treat for insurer bad faith in settling claims as a tort should receive higher payments from insurers because of the greater potential damages insurers face in claims disputed in court. We test this hypothesis using data on automobile insurance claims for accidents occurring during 19721997, exploiting differences in states laws and variation in timing of states adoption of bad faith rules to identify the effects of tort liability. We find that the presence of tort liability for insurer bad faith increases settlement amounts and reduces the likelihood that a claim is underpaid.
7730 ‎$w‎MAP20077000727‎$t‎The Journal of risk and insurance‎$d‎Nueva York : The American Risk and Insurance Association, 1964-‎$x‎0022-4367‎$g‎03/03/2014 Volumen 81 Número 1 - marzo 2014