5 Signs Your Insurance Company May Be Acting in Bad Faith in Nevada

• July 1 2026
• |   Insurance

Insurance companies sell peace of mind. You pay premiums year after year, trusting that when a fire, flood, or serious injury happens, your insurer will honor the contract. When an insurance company in Nevada starts acting in bad faith, that promise breaks, and you may be left holding the bill for losses you were supposed to be protected from.

Bad faith insurance practices are more common than most policyholders realize, and they often hide behind paperwork, polite phone calls, and dense policy language. Spotting the warning signs early can protect your claim, your finances, and your peace of mind.

Key Takeaways about When Insurance Companies Act in Bad Faith

• Bad faith insurance happens when an insurer unreasonably denies, delays, or underpays a valid claim.
• Nevada policyholders have the right to bring a first-party bad faith case against their own insurance company.
• Common warning signs include unexplained delays, lowball offers, and concealed policy limits.
• Documenting every communication with an insurer is critical to proving bad faith later.
• Working with counsel trained specifically in insurance law, not just general personal injury work, can make a real difference in these cases.

What Does Bad Faith Insurance Actually Mean?

Bad faith means an insurance company has not treated you fairly under your policy. Nevada’s Unfair Claims Practices Act, found at NRS 686A.310, lays out specific behaviors insurers are not allowed to engage in when handling a claim.

Your insurer must investigate your claim promptly, communicate honestly, and pay what you are owed under the policy. When they cut corners or stall on purpose, that crosses the line. Nevada recognizes first-party bad faith, which means you can take legal action against the company that took your premiums when it mishandles your own claim.

It is worth noting that Nevada does not recognize third-party bad faith, so these claims are limited to the relationship between you and your own insurance company.

Sign 1: Unreasonable Delays Without a Real Explanation

One of the clearest signs of bad faith is a claim that drags on with no good reason. After you file, your insurance company is required to respond, investigate, and make a decision within a reasonable time frame.

If weeks turn into months and your adjuster keeps asking for documents you already sent, or stops returning calls altogether, take note. Insurers sometimes use delay as a tactic, hoping you will give up or accept a smaller amount out of frustration. Save every email, voicemail, and letter, so you can show the timeline later.

Sign 2: Are They Making Lowball Offers Without Explanation?

This is one of the most telling signs of bad faith. A fair offer should be supported by a clear breakdown of how the insurance company valued your claim. When the number arrives with no math behind it and does not come close to your documented losses, something is off.

We have seen this play out firsthand. In one case, a client suffered serious traumatic brain injury symptoms days after being hit by a vehicle in a head-on collision near Reno. The insurance company offered a fraction of the $250,000 policy limits with no medical reasoning attached.

After pushing the case into discovery, we uncovered a hidden $1 million umbrella policy the insurer had quietly left out of the conversation.

If the offer feels random, or worse, insulting compared to your documented losses, do not accept it without a careful second look.

Sign 3: Hidden or Misrepresented Policy Limits

Your insurance policy is a contract, and you have a right to know exactly what coverage you paid for. When an adjuster downplays the available coverage, glosses over an umbrella policy, or fails to mention additional endorsements or stacking provisions, that lands squarely in bad faith territory.

This issue comes up often with motor vehicle claims involving out-of-state drivers along the I-80 corridor between Reno and Truckee. Nevada allows certain underinsured motorist coverage to “stack,” meaning you may have access to more coverage than the adjuster initially admits.

A thorough policy review by counsel trained in insurance coverage often surfaces dollars the company never offered up front.

If your adjuster gives you a flat answer about policy limits without sending you the full declarations page, ask again in writing.

Sign 4: Why Would an Insurer Deny a Claim Without Investigating?

Because a quick denial saves them money in the short term. Nevada law requires insurance companies to conduct a reasonable investigation before denying any claim, and a denial issued before the facts are gathered can support a bad faith case.

Watch for these patterns:

• A denial letter that arrives suspiciously fast, before anyone inspected the damage or reviewed your medical records.
• Reliance on a vague policy exclusion without showing how it actually applies to your situation.
• Refusal to interview witnesses, request records, or send out an adjuster.

A denial that feels rushed is often one that will not hold up under closer legal scrutiny.

Sign 5: Misrepresenting Policy Language or the Law

Insurance policies are dense, and insurance companies know most people will not read every page. Some adjusters take advantage of that by telling policyholders their claim “isn’t covered” based on a misreading, or even a flat-out twisting, of the policy language.

We have handled cases stretching from Reno to the Truckee Canal flood region, where insurers tried to lean on exclusions that did not actually apply. In one matter, an insurance company refused to defend its insured by citing an “earth movement exclusion” on a flood claim that had nothing to do with earth movement.

The case eventually resolved in favor of the homeowners after a long fight that included claims for breach of contract, bad faith, fraud, and oppression.

When an insurer’s explanation of your coverage does not match what your policy actually says, get a second set of eyes on the document.

FAQs about Bad Faith Insurance in Nevada

Below are a few common questions Nevada policyholders ask when they suspect their insurance company is not playing fair.

How long do I have to file a bad faith claim in Nevada?

The deadlines depend on the type of policy and the conduct involved, and they can be shorter than people expect. Talking with counsel early protects your options.

Can I sue my own insurance company in Nevada?

Yes. Nevada recognizes first-party bad faith, which allows you to bring legal action against your own insurer when it mishandles a claim under the policy you paid for.

What kind of damages are available in a bad faith case?

Depending on the facts, damages may include the unpaid policy benefits, emotional distress, attorney fees, and in egregious situations, punitive damages under NRS 42.005.

Does bad faith only apply to car insurance claims?

No. Bad faith can arise with property, life, disability, homeowners, and commercial policies. Anywhere an insurer owes a duty of good faith and fair dealing, the rules apply.

Do I have to accept the first offer from the adjuster?

No, and you generally should not without reviewing it carefully. Initial offers are often well below what the policy actually allows.

Will filing a bad faith lawsuit cancel my coverage?

Insurance companies are not allowed to retaliate against you for asserting your legal rights. If they try, that can become additional evidence of bad faith.

Talk With a Nevada Insurance Attorney Who Knows Bad Faith Inside and Out

If your insurance company is delaying, denying, or underpaying your claim in Nevada, you do not have to fight them alone. Leverty & Associates Law has represented Nevada policyholders since 1979, and our multi-generational team includes attorneys with an LLM in Insurance Law and decades of courtroom work across Reno, Las Vegas, and the surrounding communities.

We treat every case as an intimate partnership. We listen first, then we do the unglamorous, grueling work it takes to win, whether that means digging through hundreds of pages of policy language or fighting motions to compel hidden coverage information.

Call us in Reno at (775) 322-6636 or in Las Vegas at (702) 507-0201 for a confidential conversation about your claim. We are here to listen.