INSURANCE BAD FAITH DEMAND LETTER – MICHIGAN
To: [Insurance Company Name, Claims Department Address]
From: [Insured/Claimant Name, via Counsel if applicable]
Date: [DATE]
Claim Number: [CLAIM NUMBER]
Policy Number: [POLICY NUMBER]
Insured: [INSURED NAME]
Date of Loss: [DATE OF LOSS]
Claim Type: [First-Party / UM-UIM / Property]
1. INTRODUCTION
This letter demands immediate payment. Failure to pay triggers 12% penalty interest under Michigan law.
2. FACTUAL BACKGROUND
- Date of Loss: [DATE] — [describe loss]
- Coverage: [$LIMITS]
- Status: [Unpaid / Underpaid / Denied]
3. LEGAL BASIS – MICHIGAN REMEDIES
Penalty Interest (MCL § 500.2006)
Michigan law provides that if an insurer fails to pay a claim on a timely basis, the insurer must pay 12% annual penalty interest from the date the claim was payable.
Unfair Trade Practices (MCL § 500.2026)
Michigan's Unfair Trade Practices Act prohibits unfair claims settlement practices.
Note: Michigan does not recognize an independent tort of first-party bad faith. Claims are primarily based on breach of contract and statutory penalties.
4. DAMAGES
- Policy benefits: [$AMOUNT]
- 12% penalty interest from date payable
- Attorney's fees (if applicable under policy or statute)
5. DEADLINE
Payment due by: [DATE – 30 days]
Signed:
[Name / Attorney]
[Contact Information]