Insurance companies do not advertise how they deny customer claims or treat their customers when a dispute arises. Who wants to purchase insurance knowing that their insurance company treats them like the enemy? I am sure that State Farm hated to read about Discrimination Concerns at State Farm. Church Mutual probably does not like to brag about beating one of their Church customers in court, as I mentioned in Actual Cash Value Estimates Need To Be Made In Florida—How A Church Lost To Church Mutual.

If you read this blog, I encourage you to write comments. One of those is from one of the smartest and most motivated insurance educators, David Thompson. If you have a chance to go to a seminar or speech he is giving, do not miss it. David wrote a comment about the Church Mutual post:

When deciding to insure with Church Mutual, church leaders better understand that Church Mutual is going to read the literal and technical wording of its policies after a loss occurs.’

Isn’t that what an insurer is supposed to….pay claims based on what the insurance contract says? Imagine if the insurer said, ‘We don’t care what the policy says, here is how we will pay/deny this claim.’

Just RTFP and do what it says.

This was my response:


The insurance company won fair and square. The attorney blew the case.

If that RCV estimate was correct, however, the ACV amount surely would have been higher than the deductible. My point is that there is an incentive for insurers to lowball and delay payment of claims to prevent payment of full RCV. Do you agree?

I made a two-hour presentation about claims ethics yesterday. After the speech, a number of public adjusters commented about how some insurance companies are not like Church Mutual, which pays strictly by the literal word of the policy. One told me that “Allstate and Farmers in Illinois routinely pay on late reported but obvious roof damage claims and often without providing ACV estimates.” I was told they routinely do this so long as those insurers were on the risk, and it is obvious that whatever loss happened during their policy limit. I almost fell out of my seat. That has not generally been my experience. But good for Allstate and Farmers. Most people are not getting up on their roof immediately after a storm and usually wait until a leak appears.

The insurance company you choose to insure with makes a difference. Some insurance companies adjust by the literal word of the contract and try to deny or underpay claims based on advantages gained in that wording. From my experience, AMICA is the best, and Chubb used to be the best but is still much better than others. They often look for ways to pay and for customers who want a long-term relationship. We do not have a lot of lawsuits against them or claim horror stories. To be fair, it was great to hear about Allstate and Farmers finding a way to pay their customers even if the law and literal policy language may have allowed for a technical defense.

In my line of work, I routinely hear the claims handling horror stories. I made this reply to a recent comment in a blog post:

We certainly do not hear about all the great things claims handlers do because people only come to lawyers when there is a problem.

Thirteen years ago, I wrote in Fair And Balanced:

Nobody calls my office telling me what a great job their adjuster has done to fairly maximize their recovery in a prompt manner. Why should they? Risk managers, property managers, insurance agents, attorneys, public adjusters, and policyholders generally call our firm because they need help with claim delay or a denial. Their stories usually have derogatory, but colorful, language describing the insurance company representatives.

Last week, the Citizens Property Insurance Corporation’s General and Assistant General Counsel met with me regarding a number of claims topics. At the time, I knew my blog regarding recent complaints about Citizens and TWIA was about to be published. I told them about the complaints. They seemed bewildered. They explained their belief that the recent change in claims management had been very positive and a good move towards improving Citizens. I promised to send them examples of our findings so we could determine if what I was hearing from others is accurate.

The point is that my views are largely shaped by an upset or wronged policyholder’s view. My livelihood is made representing them. My most significant daily activities are trying to figure out how to prove that insurance companies act in bad faith and why our firm’s clients are entitled to more money.

Comments to this blog are often ‘atta boy’ cheers from policyholders and colleagues when I write about or expose instances of insurance company misconduct. Sometimes, my colleagues criticize my comments regarding the good business of insurers or when I empathize with an insurer point of view. I am certain that these cheers and jeers have some impact upon my view.

So, the answer to today’s post is “no,” the claims cultures are not the same, even within the same insurance company in different geographic areas.

Thought For The Day

Though force can protect in emergency, only justice, fairness, consideration and cooperation can finally lead men to the dawn of eternal peace.
—Dwight D. Eisenhower