Sometimes it is fun to see what other states do. Here in Massachusetts, insurer bad faith claims are for all intents and purposes a product of statute, and the statute authorizes multiple damages and awards of attorney’s fees to a prevailing plaintiff. Hence, there is a significant amount of bad faith litigation in this jurisdiction.
As part of an upcoming Defense Research Institute publication on insurance bad faith law, I contributed a review and overview of New York law on insurance bad faith. New York does not grant such a broad right of action, and in fact does not even allow a private statutory right of action. This and more is in the New York section of the materials.