What Is a Key Difference Between Bad Faith and Breach

question 24

Multiple Choice

What is a key difference between bad faith and breach of an insurance contract?

• A)Only a policyholder can sue for bad faith and only an insurer can sue for breach of an insurance contract
• B)Breach of an insurance contract is always unintentional but bad faith is always intentional.
• C)Punitive damages are appropriate because of bad faith,but not when there is a breach of an insurance contract.
• D)There is no difference.All breaches of an insurance contract are in bad faith.

---

Definitions:

Empirically

Based on observation or experiment rather than theory or pure logic; grounded in real-world evidence.

Cognition

The mental action or process of acquiring knowledge and understanding through thought, experience, and the senses, encompassing processes such as attention, memory, reasoning, and problem-solving.

Knowledge

The fact or condition of knowing something with familiarity gained through experience or association.

Mental Processes

Internal, cognitive activities that are involved in acquiring, processing, and storing information.