Merry Christmas, Happy Holidays, and Season’s Greetings! I hope all of you are enjoying some well-deserved time off. And since many of you are on holiday, I’d like to pass along some light insurance reading that may interest you.
Continue Reading...It’s no secret that insurance companies are in business to make money, but the lengths some insurance companies go to in order to increase profits is alarming. In fact, dozens of posts on this blog have alerted our readers to the improper actions some insurance companies may take to put profit above their policyholders’ interests.
Continue Reading...Fire insurance claims spike on Thanksgiving Day. I became interested in this fact after viewing the following commercial by Allstate:
Continue Reading...
Policyholders with flood and all risk policies usually do not have as many problems collecting benefits following a hurricane where wind and flood damaged a structure. Those with only one policy are not so fortunate. When the combination of payments from both policies is less than the cost to repair or when delays in payments occur, numerous issues arise.
Continue Reading...
One of the questions I hear most often from policyholders is, “why is the insurance company handling my claim in an inadequate fashion?” Often, the policyholders are confident that if they could just explain the situation and get someone’s attention at the insurer’s main office, their claim would be resolved. Many of my clients and former clients explained they tried to get the corporate office’s attention—and to no avail. This is usually the point where conversations start with a neighbor or co-worker about what to do; late night internet searches are done, and the insureds realize they need to start keeping a tally on just how poorly the claim is being handled. This is when public insurance adjusters are often hired. A client explained to me that she was happy to pay someone 10% of her claim so she could carry on with her everyday life and pass the burden on to a professional. She explained that dealing with the insurance company forced her to take time away from her job, and that if she spent any more time on the phone with the insurance company between 9-5, she was sure she was going to be in trouble with her boss. Now, the same client has also hired a lawyer to get the insurance company’s attention and to get the claim resolved.
This Property Insurance Coverage Blog set record visits last month. Thank you! I noticed a significant drop as the Easter weekend started. The Florida legislature took a well deserved breather last week as well. So, it seems like it is a good time to get caught back up.
Continue Reading...Insurance advertisements have never been more entertaining. While perusing the net for information regarding Safeco and Liberty Mutual, I came across a number of insurance company television advertisements. We often use ad firms to find and pull the ads of some of our opponent insurers. It can be done cheaply through YouTube.
Continue Reading...Allstate Insurance Company lost a bench trial involving the claims practices employed in its Claims Core Process Redesign program first implemented in the 1990’s. The findings by the trial court are significant because the Court indicated that those claims practices violate standards which are routinely violative of unfair trade and claims practices in most of the states. The findings indicate these were done as a general business practice.
Continue Reading...Suppose you knew that your insurance company had started a new claims practice program called “Quantum Leap” to increase corporate practices by making certain no claim was overpaid—would you buy that insurance? Would you feel peace of mine if you knew that secret program was in place and had such a claims philosophy?
Continue Reading...I was thinking about the question of property insurance trade associations and lobbying while reading today’s St. Petersburg Times article, At what Cost Care? The article was a question and answer discussion with Wendell Potter, who was a public relations executive for two major health insurers. Potter has given an inside view into the political and social power of the health insurance industry in a manner most Americans probably deplore. I wonder if property insurers are different? I doubt it.
Continue Reading..."How did you come up with that amount for my (or my client's) claim?" I was thinking of that question while taking the deposition of an Allstate corporate representative in an Indiana claims practice case, and how an insurance adjuster should honestly answer it. It is the same question millions of other policyholders, public adjusters, and attorneys ask insurance company representatives every day.
Continue Reading...An attorney from another law firm asked me whether an insurer is obligated to investigate facts supporting coverage in a property insurance coverage dispute. It is common for colleagues to share information and help when they can. It seems that the more one shares, the more one receives --usually with compound interest.
Continue Reading...Why are major insurance companies selling insurance with "feel good" messages rather than explaining how many different types of accidents and catastrophes they will not cover? If they were honest, wouldn't they explain to customers what is not covered before the purchase? Sandy Burnette wrote a comment to "Is the State Farm Policy Really Worth Anything?" As I indicated in yesterday's "Some Public Adjuster and Insurance Attorney Concerns and My Blogging Mistakes," he made a valid criticism which I corrected and appreciate him calling to my attention.
Continue Reading...David Berardinelli made a presentation at NAPIA's Convention on Friday. His topic, "From 'Good Hands' to Boxing Gloves: How Allstate Changed Casualty Insurance in America," was an excellent and updated version of a speech I have seen before. Many of his points are important to understanding why the claims culture has changed so much over the past twenty years. Sadly, part of the story he tells reflects the greed of some executives in the financial industry.
Continue Reading...What is the value of insurance if it does not pay for insured losses? Imagine if you had a significant accidental water damage to your home or business, do you know whether your insurance company has your back? Will it really be there to help you? Don’t count on it. Today, modern insurance companies are re-writing their insurance policies to limit what is covered and excluding many losses that used to be covered under all-risk policies. State Farm, as an insurance industry leader, is leading the charge of making an insurance product that no consumer should trust as providing the amount of coverage the insurance product afforded 25 years ago. It is always important to remember that Policyholders Buy Insurance for Peace of Mind and Not Economic Advantage and that concept is being defeated as carriers try to gain economic advantage by changing small print in the policy that may have significant consequences discovered by the policyholder only after disaster happens. To be Fair And Balanced with State Farm, I could have substituted Allstate, Nationwide and USAA into the title.
Continue Reading...Motivated claims adjusters need to study, improve, and be noticed for their skills and dedication. The May edition of Claims Magazine featured two stories I found interesting for different reasons. One article every adjuster should read is "Designation Envy-Why CPCU Should Matter to You." The other article, "Emerging Transformed-New Challenges Create Opportunities for Independents," should be read by claims practice attorneys and experts because it provides a glimpse into claims cultures designed to reduce amounts paid to policyholders.
Continue Reading...Recently, Allstate has accused other insurers of investing in credit default swaps. Does Allstate have knowledge of insurers engaging in this illegal activity? Or are these allegations a facade for the new federal oversight that would place Allstate under control of the federal government. My view on this topic is pointed:
Allstate and other major insurers are seeking federal charter to avoid state consumer protection laws and to gain an economic advantage over other property and casualty insurers. The federal legislation offers no specified safeguards for consumers, and provides for the same inept federal regulation that allowed the collapse of our financial system.
Continue Reading...If you love dealing with your group health insurance bills and claims, you will be overjoyed with the new legislation proposed in Congress allowing property insurance companies to apply for a Federal Charter. This proposed legislation is the most unfair and anti-consumer federal legislation filed in recent years.
Continue Reading...I am back from my epic 50th Birthday Celebration. I will have plenty to write from the experience. There is a lot to learn about life from a trip to Italy. If you have not visited, you must, and do not wait to put it on a "bucket list."
Do you ever take time to think about how another views your thoughts and philosophies? When you have two nine hour flights, you have some time to ponder these ideas.
In the insurance claims environment, there is a picture I have used in a presentation, Why Can't We All Just Get Along? to show how opposing individuals often react to each other:
Free enterprise is great until your competitors beat you. Dominant competitors may find it advantageous to combine interests to prevent new players from entering markets, destroying profit margins, and taking market share. It is amazing that there has not been more investigation and calls for transparency into the major personal lines insurance companies’ discussions and agreements which may reveal such a conspiracy. While anti-trust exemptions exist for insurance companies regarding sharing of loss data for rate making and other rate or form issues, there are no anti-trust exemptions for agreements that otherwise restrain trade and competition through collusion.
Continue Reading...State Farm is hard to figure out. They say one thing and often do another. When you finally get to the decision makers, there is usually some logic to why they do things despite disagreement from consumers or regulators. State Farm's announcement that it was leaving the Florida property market really has me wondering--"what's up?" From what I read and hear, I am not the only one.
Continue Reading...A financially strong and profitable insurance industry is in everyone's best interest. When insurance is profitable, companies sell more of their products, usually at more affordable rates. Consumers and insurers win. A tongue in cheek example of this is found in my line of work. Our firm wants insurance companies to sell as much of their product as they can. Affordable insurance with broad coverages sold to everyone gives insurance claims departments more opportunity to do what is in their short term economic interest---delay and deny payment of claims.
Continue Reading...National media articles have highlighted Ed Liddy's appointment as the head of AIG during its unwinding. His task is a large one. A BestWeek article presents Liddy as a champion corporate strategist. The article quoted one person as saying Liddy was extremely "ethical." He may be, but my perception of Ed Liddy was shaped by his role in developing Core Claim Practice Redesign while at Allstate. No customer or consumer advocate could call those claims practices as "ethical."
Continue Reading...Allstate Insurance Company fought the law in Florida -- and the law won. After Allstate and its lawyers thumbed their noses at the Florida Office of Insurance Regulation's requests for documents and information earlier this year, Florida insurance regulators prohibited Allstate from offering new policies in Florida. For anybody who watched the proceedings or saw the hearing on videotape, it was a disgusting display of corporate arrogance. Allstate delayed and simply refused to provide answers to regulators, even though it was legally obligated to do so.
The American Association for Justice conducted a study and concluded that Allstate Insurance is the worst insurer in America. (Click here to see a complete copy of the study) The report speaks for itself, but it truly details some outrageous behavior and a claims culture that clearly favors Allstate's pocketbook over beneficiaries.
Continue Reading...Best is reporting that State Farm continues to retreat from the insurance business in Mississippi. The headline suggests that State Farm merely canceled policies, but the article reveals that State Farm canceled 900 policies, and changed the terms of 5,000 more customers by refusing to insure for wind peril. As I have explained, our largest insurance carriers are getting out of the risk business.
Continue Reading...Capitalism and economic venture are alive and well in the Florida insurance market. The Florida Underwriter reported this month that over 1.7 million policies have been written by new insurance companies since the 2004 hurricane season. As Allstate, State Farm and Nationwide retreat from the Florida property insurance market, these new insurance companies are accepting risks that would otherwise end up with Citizens Property Insurance Corporation.
Continue Reading...Allstate Insurance Company has reportedly canceled or non-renewed more than 500,000 Florida property insurance policies over the last five years. The decision to cut those policies was made by Allstate management. Where were the insurance industry spin and propaganda people--often referred to as "spokespersons" of various insurance industry trade associations--to say that the victims of that decision were Allstate agents? The decision to raise the remaining Allstate policy rates an average of over 40%, after promising much lower rates to Florida government officials, was made by Allstate management.
Continue Reading...It's about time. For a decade, Allstate has refused to comply with discovery and court rules regarding its internal documents which demonstrate who, how and why Allstate redesigned everything in its claims program to simply pay less on claims. The Florida First District Court of Appeal issued an opinion which condemns many of the tactics Allstate and its attorneys have long used to thumb its nose at judges.
Continue Reading...The article in today's Tampa Tribune regarding a Federal Wind Insurance debate comes as no surprise. Amazing how big Insurance is adopting Enterprise Risk Theory to further its interest. Since large corporations in the insurance field are not so much interested in how they make money, just that they make as much as safely possible, it is no wonder they are making the case for Federal wind coverage.
Continue Reading...The Florida First District Court of Appeal upheld the Florida Office of Insurance Regulation's suspension of Allstate writing any new policies in an opinion issued last Friday. Allstate had refused or was slow producing documents to the Department as it investigated Allstate's role in duping Florida legislators and regulators into passing legislation which should have resulted in lower rates. This was an important legal decision and the news media picked up on it right away. (Boston Globe; Tampa Tribune; Chicago Tribune) Within hours of the decision, Allstate placed over 150,000 previously "secret" documents regarding its claims practices on the Web Friday night.
Continue Reading...Allstate Insurance Companies are being called before the Florida Senate Select Committee to testify today and tomorrow regarding a number of issues, especially its rate filings. I have publicy applauded this inquiry and those interested can read the Committee's filings on the internet. The issues are a little broader than just rates. The letter to Allstate from Senators Atwater and Geller list claims history and profitability factoring. I expect that the Core Claims Process Re-Design documents and processes will again be a matter of inquiry. The hearing should be interesting because something like this has never occurred. Public inquiry with extensive press coverage regarding an insurance company's honesty of its operations is something that should have occurred long ago.
Tuesday was a rather interesting day. Our firm helped win a $4.6 million dollar judgment for a panhandle Condominium Association last year. Citizens Property Insurance Corporation did not pay, as usual, but appealed. I argued the case [Citizens Property Ins. Corp. vs. East Pass Towers II Condominium, No. 1D07-2727 (Fla. Dist. Ct. App. oral argument Jan. 22, 2008)] for our client in Tallahassee, met with the Association representatives, and then made my way up the hill to the State Capitol where the Select Committee on Property Insurance Accountability was meeting. One of firm's lobbyists briefed me on the schedule and introduced me to some of the panel members I had not previously met. We wondered if the media attention and articles (Tom Zucco, No Auto for Allstate, St. Petersburg Times, January 17, 2008, at A1; Jerome R. Stockfisch, State Bans Allstate From writing any New Policies, January 17, 2008, Tampa Tribune) following last week's 0ffice of Insurance Regulation hearing would cause more attention to be focused on these proceedings.
Continue Reading...The Tampa Tribune reported Friday that the Florida Department of Insurance is seeking McKinsey & Company consulting reports which are allegedly tied to an Allstate plan to underpay claimants. These documents are at the heart of contention in a Colorado case where Allstate is being fined for not providing them, and also in a Missouri Department of Insurance investigation where Allstate is being fined $25,000 per day for refusing to cooperate with the state regulator's investigation. I am seeking similar documents in an Indiana case in which Allstate has been already sanctioned and ordered to provide them. For over a decade, I have criticized Allstate's reliance on a claims program which appears to unethically calculate the value of an individual's bodily injury claim and not honestly disclose how Allstate arrived at its determination.
Continue Reading...Allstate and other insurers are notorious for not complying with discovery seeking internal corporate documents which would expose corporate culture in bad faith cases. From the news yesterday and today, it appears the Florida Department of Financial Services has learned the same lesson most policyholder attorneys have known for quite some time.
Continue Reading...That is the question of the hour, but should it be? A book has been written about the McKinsey Documents and discovery battles are constantly being waged over them, but, the Holy Grail of Allstate's claims handling practices (as these documents have become equated) cannot change a poor factual case into a strong one and cannot overcome greed being camouflaged as a quest to right injustice.
Continue Reading...Florida newspaper stories exposing the recent insurance rate hike requests should not come as a surprise to anyone. This is just the latest example of why the public needs regulation of the insurance industry. It is a business built upon future promises that are routinely broken when the return performance is due. Why the Florida legislature seemed convinced that by shifting the risk of catastrophic loss to its citizens would actually result in lower premiums is bewildering. It is an unrealistic to expect that an industry, which lives by the sharp letter of the law and fineprint of contract, will follow through on promised rate reductions in the absence of legal or contractual enforcement; this laissez-faire approach suggests that the industry still has a strong lobby in Tallahassee.
Continue Reading...Throughout U.S. history insurers have routinely discriminated against minorities. Discriminatory treatment included such practices as charging minorities higher rates, offering minorities policies with inferior coverage, not returning calls for information from minority applicants or denying minorities coverage altogether. Homeowners insurance redlining is a form of this discrimination where an insurance agency or agent treats homeowners differently not necessarily because of their minority status, but because of the minority composition of the neighborhood their home is located in.
Continue Reading...1-877-449-4700
Enter keywords:
