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.
Here is an excerpt of the Court proceedings:
I find with respect to each of the Plaintiffs, Roxanne Martinez, Charlie Jimenez, Adan Carriaga, and Christa Okon, I find by a preponderance of the evidence that Allstate has violated Section 59A-16-20E and G. It violated Section G by compelling each of the Plaintiffs to litigate their insurance claims through a jury trial to obtain final judgment, and to recover amounts due under a policy by offering substantially less than the amounts they ultimately recovered when they went through trial.
I find that Allstate violated Section 59A-16E by not attempting to effectuate a prompt, fair, and equitable settlement of their claims in which liability had become reasonably clear.
I find that each of the Plaintiffs suffered actual damages as a result of Allstate’s willful violations of Sections 59A-16-20E and G, and that each of the Plaintiffs are, therefore, entitled to recover their actual damages under Section 59A-16-30.
I find that each of the Plaintiffs’ claims for damages will be taken under advisement by me, and I did consider the Plaintiffs’ presentation this afternoon about what you claim the actual damages are for those claims. I’d like to take some time and think about that and determine, after considering the evidence, what the actual damages are for each of the Plaintiffs under their claims under the UCPA.
The Court also found these practices amounted to an abuse of process:
I also find in favor of the Plaintiffs with respect to malicious abuse of process. I find that Allstate has used the judicial process in New Mexico and with these Plaintiffs, the jury trial process and judicial proceedings, for each of the Plaintiffs with the primary motive to accomplish an illegitimate purpose and not intended by that process, and in a manner suggesting the wrongful use of the jury trial system; an attempt to delay or extort each of the Plaintiffs into accepting less than the full value of their benefits under their policy, their MFRA policies, providing coverage for their claims.
The transcript is available here.
My hat is off to David Berardinelli. I gave him kudos in a prior post, David Berardinelli’s Fight Against Allstate’s Claims Culture.