Understanding Statutes of Limitations
A statute of limitations is the legal deadline for filing a lawsuit. Once this deadline passes, you lose your right to sue, regardless of how strong your case might be. For insurance bad faith claims, the applicable limitations period depends on:
- The type of claim - Contract vs. tort (bad faith is typically a tort in most states)
- Your state's law - Each state sets its own deadlines
- When the clock started - The "accrual" date can be complex
Do not wait until close to the deadline to take action. Evidence becomes harder to gather, witnesses forget details, and you need time to properly prepare your case. If you believe you have a bad faith claim, consult an attorney well before any deadline approaches.
When Does the Clock Start?
Determining when the statute of limitations begins to run (called "accrual") is often more complicated than the limitations period itself. Different rules may apply:
The "Occurrence Rule"
In some states, the clock starts when the bad faith conduct occurs, regardless of when you discovered it. This is the traditional and stricter approach.
The "Discovery Rule"
Many states apply a discovery rule, meaning the clock does not start until you knew or reasonably should have known about the bad faith conduct and resulting harm. This is more favorable to policyholders.
The "Continuing Violation" Doctrine
If the insurer's bad faith conduct is ongoing (such as continuing to deny a claim without justification), some courts hold that each day of misconduct restarts the clock.
California applies the discovery rule to bad faith claims. The statute of limitations begins to run when the plaintiff discovers, or through reasonable diligence should have discovered, facts constituting the wrongful conduct and resulting injury.
California courts have also recognized that ongoing bad faith conduct can constitute a continuing wrong, potentially extending the limitations period. See Aryeh v. Canon Business Solutions, Inc. (2013) 55 Cal.4th 1185.
State-by-State Limitations Periods
The table below shows the general statute of limitations for bad faith insurance claims in each state. Note that these are general guidelines; specific circumstances, claim types, and recent case law may affect the applicable period.
| State | Bad Faith (Tort) | Contract | Notes |
|---|---|---|---|
| Alabama | 2 years Short | 6 years | Tort claim for bad faith refusal to pay |
| Alaska | 2 years Short | 3 years | Discovery rule may apply |
| Arizona | 2 years Short | 6 years | Bad faith is tort-based |
| Arkansas | 3 years Medium | 5 years | General tort statute |
| California CA | 2 years Short | 4 years | Discovery rule applies; CCP section 339(1) |
| Colorado | 2 years Short | 3 years | Statutory and common law bad faith |
| Connecticut | 3 years Medium | 6 years | CUTPA claims may have different rules |
| Delaware | 2 years Short | 3 years | Bad faith treated as tort |
| Florida | 4 years Long | 5 years | Statutory bad faith under section 624.155 |
| Georgia | 2 years Short | 6 years | Bad faith penalty statute |
| Hawaii | 2 years Short | 6 years | Tort-based bad faith claim |
| Idaho | 2 years Short | 5 years | Personal injury statute applies |
| Illinois | 2 years Short | 5 years | Section 155 claims; discovery rule |
| Indiana | 2 years Short | 6 years | Limited private bad faith remedy |
| Iowa | 2 years Short | 5 years | First-party bad faith recognized |
| Kansas | 2 years Short | 5 years | Discovery rule applies |
| Kentucky | 5 years Long | 5 years | UCSPA claims; favorable to plaintiffs |
| Louisiana | 1 year Short | 10 years | Very short tort period; discovery rule |
| Maine | 6 years Long | 6 years | General civil action statute |
| Maryland | 3 years Medium | 3 years | No separate bad faith tort recognized |
| Massachusetts | 3 years Medium | 6 years | Chapter 93A and 176D claims |
| Michigan | 3 years Medium | 6 years | Limited bad faith recognition |
| Minnesota | 2 years Short | 6 years | Discovery rule applies |
| Mississippi | 3 years Medium | 3 years | Bad faith punitive damages available |
| Missouri | 5 years Long | 5 years | Vexatious refusal statute |
| Montana | 3 years Medium | 5 years | UTPA independent cause of action |
| Nebraska | 4 years Long | 5 years | Bad faith in contract context |
| Nevada | 4 years Long | 6 years | Strong bad faith protections |
| New Hampshire | 3 years Medium | 3 years | Personal action statute |
| New Jersey | 6 years Long | 6 years | Contract-based bad faith |
| New Mexico | 4 years Long | 6 years | UPA and common law claims |
| New York | 3 years Medium | 6 years | Limited bad faith recognition |
| North Carolina | 3 years Medium | 3 years | UDTPA claims available |
| North Dakota | 6 years Long | 6 years | General limitations apply |
| Ohio | 4 years Long | 6 years | Discovery rule; bad faith well-established |
| Oklahoma | 2 years Short | 5 years | Strong bad faith remedies |
| Oregon | 2 years Short | 6 years | Discovery rule applies |
| Pennsylvania | 2 years Short | 4 years | Bad faith statute: 42 Pa.C.S. section 8371 |
| Rhode Island | 3 years Medium | 10 years | Personal injury statute |
| South Carolina | 3 years Medium | 3 years | Bad faith recognized but limited |
| South Dakota | 3 years Medium | 6 years | First-party bad faith allowed |
| Tennessee | 1 year Short | 6 years | Very short; bad faith penalty statute |
| Texas | 2 years Short | 4 years | Insurance Code chapter 541; DTPA |
| Utah | 4 years Long | 6 years | Breach of implied covenant |
| Vermont | 3 years Medium | 6 years | Personal action statute |
| Virginia | 2 years Short | 5 years | No private bad faith action recognized |
| Washington | 3 years Medium | 6 years | CPA claims; discovery rule |
| West Virginia | 2 years Short | 10 years | UTPA private action |
| Wisconsin | 3 years Medium | 6 years | Bad faith in tort |
| Wyoming | 4 years Long | 8 years | Discovery rule applies |
This table provides general information only and should not be relied upon as legal advice. Statutes of limitations can be affected by tolling provisions, discovery rules, claim types, and recent court decisions. Always consult with an attorney in your state to determine the applicable deadline for your specific claim.
Tolling: When the Clock Pauses
In certain circumstances, the statute of limitations may be "tolled" (paused), extending your deadline to file. Common tolling situations include:
Minority or Incapacity
If you were a minor or legally incapacitated when the bad faith occurred, the limitations period typically does not begin until you reach majority or regain capacity.
Fraudulent Concealment
If the insurer actively concealed its bad faith conduct, preventing you from discovering the claim, the limitations period may be tolled until you discover or should have discovered the misconduct.
Continuous Treatment or Ongoing Negotiations
Some courts toll the limitations period during ongoing claim negotiations or when the insurer represents it is still evaluating the claim.
California recognizes several tolling doctrines in bad faith cases:
- Minority tolling - CCP section 352
- Incapacity tolling - CCP section 352
- Delayed discovery - Codified and common law
- Equitable tolling - When pursuing related administrative remedies
Special Considerations
Contract vs. Tort Claims
In most states, bad faith is considered a tort (civil wrong), subject to shorter limitations periods. However, you may also have breach of contract claims subject to longer limitations periods. Filing both claims preserves your options.
Statutory Bad Faith Claims
Some states have specific statutes creating bad faith causes of action (like Florida's section 624.155 or Texas Insurance Code chapter 541). These may have their own limitations periods or notice requirements.
ERISA-Governed Plans
If your insurance is provided through an employer benefit plan governed by ERISA, federal law may preempt state bad faith claims entirely. ERISA has its own limitations rules, often using the state contract period or a federal default.
Unsure About Your Deadline?
Do not risk missing your statute of limitations. I can help you determine the applicable deadlines for your bad faith claim and take action before time runs out.