It really depends on your position in the case. I have represented an employer for a claim against a carrier who denied coverage, that was a bad failth case. So, i guess you can. If you are an injured worker, then your claim will lie within the workers compensation arena and any penalties or sanctions within workers compensation will likely be your Remedy. Give some more information and you may get some more detailed answers.
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More facts would be useful in giving you a meaningful answer. What is your position in the case? What is the "bad faith" action? Who did this action? And who did they do it to? When?
If you believe that you are not being paid what you are owed, of if the insurance company is unreasonably delaying or denying your claim, you may be entitled to additional compensation if the insurance company acted in bad faith. If the Industrial Commission finds that bad faith or unfair claims processing has occurred, the Commission must award the injured worker a penalty of 25% of the benefits it finds are owing or $500, whichever is more.
California does not allow bad faith claims from injured employees in workers' compensation for improper benefit provision . Even though Workers' Comp is your only remedy, you can recover fines and penalties depending on your specific situation. (I'm assuming you are an injured employee.) The labor code has specific provisions of self-imposed and awarded penalties for late benefit payments. If you are injured, it may be in your interest to enforce the benefits you are entitled to, rather than think about bad faith issues.
Other states have allowed civil bad faith claims to be made when workers' compensation benefits are improperly denied. California, however, has given the Board the exclusive power over these issues. Sometimes Applicant attorneys can file petitions for penalties and sanctions when there is bad faith delay or frivolous tactics being used. You should contact a lawyer for a free consultation. My office handles cases in San Bernardino.
I generally agree with the other counsel whom have posted here. Workers who try to sue the workers compensation carrier directly for bad faith routinely get thrown out of court since workers compensation is the exclusive remedy for workers and the system provides for penalties against the WC insurer. There are different rights against the carrier where the employer brings the action as they are the insured and pay the premiums for workers compensation protection. I am only aware of one case where the courts allowed a civil action against an insurance carrier and that was decided several decades ago. The insurance carriers conduct in that case was so egregious that the court carved out a very narrow exception which is almost impossible to meet. You should speak to a workers compensation attorney to address your specific facts.