A jury in the state of Texas recently ruled that Great American Insurance Company breached the policy contract it held with Compass Well Services LLC, a hydraulic fracking company.
As reported, the ruling states that Great American Insurance Company acted in bad faith when it refused to cover losses incurred by Compass Well Services after a drilling well accident. According to the court documents, Great American Refused to cover $1.5 million in damages Compass incurred by claiming insufficient evidence on the part of Compass Well Services.
The case highlights the importance for companies to understand their rights when dealing with insurers. Insurance companies, like any other company, must adhere to federal and state laws.