Many civil lawsuits are filed each year in the state and federal courts – far too many to be handled efficiently by the court system if a full-blown trial is required in every case. For this and other reasons, settlements are highly encouraged.
Under Mass. Gen. Laws ch. 176D, § 3(9)(f), an insurance company has a legal obligation to effectuate a “prompt, fair, and equitable settlement” of claims in which liability is clear. When this does not happen, Mass. Gen. Laws ch. 93A, § 9 allows the person whose rights were affected by the violation of the law to bring a civil action against the insurance company to recover damages.