Allstate has spent millions, probably billions of dollars, to craft its image of being the “Good Hands People”. Allstate has also spent millions to learn how to increase its profits by simply refusing to pay legitimate claims or by drastically underpaying claims.
To learn this new way of doing business, Allstate hired consulting firm McKinsey & Company, and the lessons that McKinsey taught Allstate are described in the McKinsey Documents. These papers are so harmful to Allstate’s warm and fuzzy image that the company claimed that they contained trade secrets and refused to disclose them for a long time. As a result, Allstate incurred millions in fines and left people wondering what the company was really, but that Allstate just happens to know a company that will insure the risky customer. The letter doesn’t say that the other company is affiliated with Allstate, and the new policy turns out to be much more expensive than the original.Allstate routinely puts great effort and resources into deceiving its customers and refusing to pay legitimate claims, and no group of Allstate customers ever suffered more than the victims of Hurricane Katrina did. As this report from a Mississippi Congressman shows, Allstate is hardly the only insurance company that makes a regular business model of refusing to pay claims. Throughout the industry, companies routinely engage in illegal and immoral business practices.
One organization that tries to guide its members on insurance issues and to protect them from scams is the American Association of Retired Persons (AARP).
But even the AARP, through its affiliation with UnitedHealth Group, has come under investigation for marketing fraud in connection with limited-benefit policies. The approach is pretty simple. For a relatively low price, the company sells a policy with a fixed-cash payout, but the buyer believes that the policy will cover much more than it actually does. So, when the customer needs the money, it’s much less than he or she expected.
The world financial crisis certainly has many causes, and an insurance company, American International Group (AIG) has played as big a role as any other company, individual, or government. AIG’s misconduct was so brazen and so damaging to the world economy that the US government stepped in and bailed out the company, at a cost of more than $85 billion to US taxpayers. That behavior has earned AIG recognition as the worst corporation of 2008.
One factor that works in favor of insurance companies that choose to engage in “Bad Faith” practices is that no federal agency regulates the insurance industry. All regulation comes from the state level, and the laws vary tremendously from state to state, as do the efforts which different states put into regulating insurers. Calls for federal regulation of the insurance industry are rising, but that would hardly be a guarantee that these companies would honor their policies.
Insurance companies are big and wealthy, and choosing not to honor their contracts is standard practice for many of them. But, when they have to defend their illegal practices in court, they often lose.
We use California’s insurance laws to bring our clients “full value” recoveries, many times the limits written in the policy, when insurance companies act illegally. It’s called “bad faith” litigation. When insurance companies stonewall legitimate claims, people who have suffered personal injuries and families suffering the wrongful death of a loved one are empowered by the law to force insurance carriers to be held accountable.
Juries don’t care for companies that choose not to honor their contracts. If an insurance company is acting in bad faith toward you or toward someone you know, check my track record holding insurance companies accountable and contact me if you need help.
Free personal injury consultation. Guaranteed confidential.
Call 1.888.777.1776.
Monday through Friday 7 am to 9 pm Pacific; Saturday and Sunday 10 am to 9 pm Pacific.
Or email us. Please provide your phone number to help us serve you better.
For all personal injury and wrongful death clients: no recovery: no fees, no costs.
Delay can result in the permanent loss of personal injury rights. Don’t put it off. Call now.
Onward,
Richard Alexander
Find more like this: Auto Accident, Insurance Bad Faith, Personal Injury, Wrongful Death
Add your comment »