Ohio

Bad Faith Claim by Statute

There’s no statutory basis for bad faith in Ohio.

‍

Bad Faith Claim by Common Law

Bad faith claims are based in common law. An insurance company has a duty to act in good faith in settling claims, but that duty is owed only to the insured. Pasipanki v. Morton (1990), 61 Ohio App.3d 184, 185, 572 N.E.2d 234. The duty arises independent of the contract of insurance, and permits the insured to bring a cause of action against his insurer in tort. Stevenson v. First Am. Title Ins. Co., Fairfield App. No. 05-CA-39, 2005 Ohio 6461, ¶23, citing Hoskins v. Aetna Life Ins. Co.(1983), 6 Ohio St.3d 272, 6 Ohio B. 337, 452 N.E.2d 1315,

Third-party claims can be assigned - Therefore, absent an assignment or the equivalent of [*23]  an assignment, a third party has no cause of action against the insurer for bad faith. Sanderson v. Ohio Edison Co., 1996 Ohio Misc. LEXIS 26.