Insurance companies sell policies to people to give them peace of mind for any future contingency or medical emergency. They promise and assure the people about how they can help them in times of contingency or emergencies. They have smart marketing teams who know how to sell policies and collect hefty premiums. People are ready to spend and pay high premiums as they are worried about their families and want to protect them. They completely trust the insurance company and hope that the company will stand by them in time of need. However these insurance companies sometimes fail to deliver what they promised, thus is known as insurance bad faith.
Insurance companies are not for charity they exist in order to make money and earn profits.