In Part 1 of this series, I addressed general requirements for the insurance carrier’s adjustment of claims. Here, I want to focus on communications between the policyholder and the insurance carrier.
Continue Reading Delayed Insurance Claim Payment in Alabama? Insurance Companies Must Timely Respond To Alabama Policyholders
If a picture is worth a thousand words, the above chart is exhibit one about how insurance claims executives feel about claims adjusters that pay more versus paying less to their policyholders. Policyholders often have their claims underpaid because insurance companies reward those claims adjusters who underpay claims. The rewards come from a view and promotion of “high performer” adjusters that pay policyholders less are better adjusters than those who pay policyholders larger and fuller amounts.
Continue Reading Why is Your Insurance Claim Underpaid? Many Insurance Companies Reward Adjusters Who Pay Less on Claims
Should insurance brokers and executives running insurance companies stand up for their insurance customers? While the comments section is sometimes passed over, I noted that a premier insurance broker, Irene Ochoa, stood up for insurance customers when responding to an article in Claims Journal, Viewpoint: J.S. Held CEO Refutes ‘Claims Surrogate’ Label.
Continue Reading Premier Insurance Broker Irene Ochoa Responds to Jon Held and Notes That Policyholders Need Protection
Similar to other states, Arizona has adopted unfair claims settlement practices statutes and regulations. While one cannot a bring a private cause of action under the Unfair Claim Settlement Practices Act1 and its companion regulations, they lay out specific standards for insurers to promptly investigate and process claims.
Continue Reading Arizona Claims Handling Guidelines at a Glance
The “do as much as you can in the aggregate” incentive for adjuster profit maximization versus “estimate more on one claim and get paid more” was the debate in 2015 Congress following Superstorm Sandy flood insurance debacle. This blog followed the last two posts, Churn and Burn Adjusting—An Admission From An Independent Adjuster, and Is “Running and Gunning” Adjusting the Same As “Churn and Burn” Adjusting?.
Continue Reading “Running and Gunning” Versus “Pay More Equals Greater Pay Incentive”
David Charles was a whistle blower about wrongful claims conduct long before yesterday’s post, Churn and Burn Adjusting—An Admission From An Independent Adjuster. In a 2014 post, National Flood Claims Do Not Get Paid Properly Because the Only Incentive is to Underpay, I noted that David Charles described a method of claims adjustment – running and gunning – which is very similar to the one posted yesterday about “churn and burn” adjusting:
Continue Reading Is “Running and Gunning” Adjusting the Same As “Churn and Burn” Adjusting?
The following is a guest blog written by an attendee whom I spoke with at the Windstorm Insurance Conference two weeks ago. I made only minor edits for easier understanding by those who are not claims professionals. I removed two sentences to maintain anonymity for the writer.
Continue Reading Churn and Burn Adjusting—An Admission From An Independent Adjuster
One of the interesting aspects of having a national policyholder insurance practice is seeing regional trends of claims processing by insurers. I have come to my own philosophy that differing insurance laws in the various states, whether statutory or by common law, are not right or wrong—they are just different. I am not so certain about claims practices because pushed to the extreme, there are plenty of ways insurance companies can frustrate the purpose of insurance, such as the use of claims processes designed to delay and underpay claims.
Continue Reading Puerto Rico Hurricane Maria Claims Still Not Paid—New York Times Reports on the Insurance Claims Crisis in Puerto Rico
Governor Gavin Newsom recently signed Senate Bill 240, which enacts new laws that regulate out of state independent adjusters. The law also addresses claim adjustment for declared emergencies. The new laws, described more fully below, became effective on October 3. 2019.
Continue Reading California Enacts New Laws that Regulate Out of State Independent Adjusters and Address Claim Adjustment Obligations for Declared Emergencies
The United States District Court for the District of Minnesota in Selective Insurance Company of South Carolina v. Sela,1 recently addressed whether the implied covenant of good faith includes a broader obligation to act “reasonably” and “properly” in making a decision about whether to pay benefits. Sela had submitted a claim for hail damage to his home. Selective investigated the claim and filed suit alleging that Sela made fraudulent misrepresentations and was not entitled to coverage. Sela counterclaimed for breach of contract, breach of the implied covenant of good faith and fair dealing, and bad faith, pursuant to Minn. Stat. §604.18.
Continue Reading Does the Implied Covenant of Good Faith and Fair Dealing Impose a Broad Duty on Insurers to Act “Reasonably” or “Properly” in Handling Claims?