An insurer may not attempt or threaten to rescind the policy where there are no valid grounds for rescission. Fletcher v. Western Nat’l Life Ins. Co., 10 Cal. App. 3d 376, 392 (1970).

An insurer may not attempt to “retire the file without payment” if the insurer, in fact, has no defense to the claim and is simply trying to pressure the claimant into accepting the settlement offer. Mustachio v. Ohio Farmers Ins. Co., 44 Cal. App. 3 358 (1975).

Unsupported allegations that the insured is guilty of insurance fraud constitute evidence of bad faith. Gruenberg v. Aetna Ins. Co., 9 Cal. 3d 566, 575-76 (1973); Mustachio, supra at 362 (accusation of arson after basis for charge eliminated by investigator).

Hostile attitude of claims personnel may constitute evidence of bad faith. Egan v. Mutual of Omaha Ins. Co., 24 Cal. 3d 809, 821 (1979)(claims personnel reduced an insured to tears in view of wife and daughter by asserting that insured was a fraud and did not want to return to work).

Adjuster’s curt and sarcastic attitude, combined with threats to sue insured, will support a finding of bad faith. Pistorius v. Prudential Ins. Co., 123 Cal. App. 3d 541, 547 (1981).

False promise to provide coverage. Diamond Woodworks, Inc. v. Argonaut Ins. Co., 109 Cal. App. 4th 1020 (2003).

Low settlement offers made during course of bad faith litigation. White v. Western Title Ins. Co., 40 Cal. 3d 870 (1985).

Trickery, fraud, backdating documents, concealing evidence, persisting in denial during course of litigation. Textron Financial Corp v. National Union, 118 Cal. App. 4th 1061 (2004).

Misleading policyholder about uninsured motorist coverage. Delos v. Farmers Ins. Group, 93 Cal. App. 3d 642 (1979).

Forcing the policyholder to sue in order to obtain benefits. Richardson v. Employers Liab. Assur. Corp., 25 Cal. 3d 232, 246 ( 1972). Punitive damages upheld where insurance company forced policyholder to litigate an uninsured motorists claim in which there was clear liability and no grounds to contest the claim. The insurance company stalled for months, forcing Richardson to pursue his claim through arbitration and then through court proceedings to confirm the award.

George F. Hillenbrand, Inc. v. Insurance Co. Of North America, 104 Cal. App. 4th 784, 818 (2002). Insurance company engaged in protracted nonmeritorious litigation against insured, when coverage should have been provided. Punitive damages upheld.

Notrica v. State Compensation Insurance Fund, 70 Cal. App. 4th 911, 949 (1999).
Punitve damages upheld where senior management misled insureds about reserving practices of company

Bertero v. National General Corp., 13 Cal. 3d 43, 65 (1974)(“defendants’ conduct consisted of filing fabricated claims in order to coerce Bertero to settle or abandon a legitimate claim. This flagrant abuse of the judicial process is precisely the type of tortious conduct that an award of exemplary damages is designed to deter”)

Caddice v. Ins. Co. Of North America, 126 Cal. App. 3d 86 (1981)(punitive damages upheld where claims representatives misled insured and concealed coverage)

Walker v. Farmers Insurance Exchange, 153 Cal. App. 4th 965 (2007) ( breach of duty to defend, to investigate, to evaluate coverage appropriately; punitive damages upheld but reduced )