In Oklahoma, an insurance company has a legal duty to fairly pay claims. This duty is technically to act in good faith and with fair dealing. An insurance company that refuses to fairly pay claims can be sued for bad faith for not complying with the law. The insured policyholder can claim emotional distress, financial losses, etc., caused by the bad faith.

It is good to keep in mind that the term bad faith is a short hand version of the duty of good faith and fair dealing. However, most adjusters and insurers use “bad faith” to describe this type of litigation. In everyday communication, saying breach of the implied duty of good faith and fair dealing is a mouthful. Bad faith is a whole lot shorter and easier to say.