Insurance Corporations Make Record Profits; Insurance Companies Fight Paying Billions in Injury Claims
Insurance corporations use tactics of denial of claims, delaying settlements and making unreasonable settlement offers.
The February 7, 2007 CNN Blog posting by CNN correspondent Drew Griffin has gotten much attention on the web, “Insurance companies fight paying billions in claims.”
- CNN: Allstate is betting you won't wait, you won't sue and you'll take what you get and walk-away [...] victims have been walking away from billions of dollars that insurers now keep for themselves.
Griffin's blog posting was the outcome from the 18 month investigation that he and producer Kathleen Johnston had just aired on Anderson Cooper's CNN show 360. Griffin / Johnston reported that the auto insurance industry tactic is not isolated to Allstate, and according to them, 10 out of 12 auto insurance providers share the same tactic of "deny, delay and defend."
CNN published Griffin and Johnston's article after the televised broadcast, “Auto insurers play hardball in minor-crash claims”
- CNN: If you are injured in a minor car crash, chances are good that you will be in the fight of your life to get the insurance company to pay all the medical costs you incur — even if the accident was no fault of your own.
Meanwhile, Allstate is fighting accusations that its methods deny policy holders legitimate benefits because of their business strategy.
A 2006 Business Week article reported similarly in the article entitled, “In Tough Hands At Allstate.”
- BUSINESS WEEK: Rather than simply rushing to the scene of an accident and doling out cash, Allstate deploys a variety of systems set in place by McKinsey to make sure it pays the minimum necessary — and it plays hardball with those who seek more.
Washington state passed a law earlier in 2007 greatly empowering an accident victim if their insurance company didn't offer a legitimate settlement. The Washington state law forced insurers to pay triple damages and lawyer fees if they fail to pay a legitimate claim and then lose in court. Previous to this new law insurers found guilty of acting in Bad Faith only had to pay what the insured what they would have been fairly due.
Currently the insurance industry is attempting to use the referendum process to strike this new law down. The legislation will be voted on fall 2007 with voters deciding on the issue.
The original CNN Anderson Cooper broadcast is available on my website courtesy of You Tube Video. And the follow up You Tube video Anderson Cooper investigative report which goes into Washington State's R67 story is also on my website.
