Article ID: 9f99b0640ebef23b31d42f473a9cb4936f1397e4828d33a621956625bb44c66b
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URL: https://www.businessinsurance.com/court-rejects-bad-faith-claims-over-delayed-comp-denial/
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Court rejects bad-faith claims over delayed comp denial - Business Insurance Skip to content Register for free Search Search Log In Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2026 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2026 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2026 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Risk Management Cyber Risks Pricing Trends Mergers & Acquisitions Technology Sponsored Content WSIA RISKWORLD Workers Comp & Safety Workers Comp Cost Control Pain Management Workplace Safety International EMEA Asia-Pacific Latin America People Events BI Intelligence Top 100 Agents & Brokers Best Places to Work 2026 Lists Directories Insurance Pricing BI Stock Index Magazine Current Issue Past Issues Subscribe Women to Watch ALL INsurance Resources Risk Perspectives Sponsored Content Webinars White Papers Court rejects bad-faith claims over delayed comp denial by Louise Esola Claims Disputes , Workers Comp Coverage , Workplace Safety Sep 11, 2026 An Arizona appeals court on Thursday upheld the rejection of a worker’s bad-faith and unfair claims processing complaints, finding that the insurer reasonably investigated his claim and paid the statutory penalty for a late denial. As documented in Halloum v. Black diamond/federal Insurance Co ., filed in the Arizona Court of Appeals, Division One, Ammar Halloum sought workers compensation benefits after falling headfirst into a gate at the bottom of stairs in November 2023 while working for Black Diamond Networks. The Industrial Commission of Arizona found the injury noncompensable because the fall was intentional, a determination the appeals court affirmed in a separate proceeding. Mr. Halloum also alleged that Black Diamond and its insurer, Federal Insurance, failed to adequately investigate his claim and issue a timely decision. The insurer denied the claim 40 days after receiving the commission’s official notice, exceeding the statutory 21-day deadline. It subsequently paid compensation covering the period from the notice through the denial, as required by Arizona law. The dispute also involved communications between the insurer and Mr. Halloum’s wife, who handled the claim while he was unable to do so. She initially sent documents to an incorrect email address, and the couple declined to meet with an investigator because they questioned her identity. An administrative law judge found that the insurer diligently sought authorization to obtain medical records, that the investigator properly identified herself and that Mr. Halloum did not fully cooperate. The appeals court found sufficient evidence supporting those conclusions. For the benefit-related bad-faith allegations at issue, Mr. Halloum needed to establish an entitlement to compensation, the court said. The finding that his injury was noncompensable defeated those allegations. The court separately rejected the unfair claims processing challenge, finding that the communication problems did not establish unreasonable conduct by the insurer. “The miscommunications between the parties are unfortunate but not a matter of unresponsiveness or neglect by the carrier,” the court wrote. The court also found that the insurer had addressed its untimely denial by paying the statutory penalty. It affirmed the commission’s ruling in a nonprecedential memorandum decision. 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