I think Flo needs to start looking for a new job, as Progressive is going down. If your insurance company won’t stand behind you, you need a different insurance company. This reminds me of Allstate when they tried to sell flooded cares.
Information from another online insurance periodical includes the following info. there was a lot more info available than what was in the article in IJ. Seems slike Progressive has a problem here, especially with what Nationwide did.
“The Fisher family’s lawyer, Annapolis, Md.-based attorney Allen Cohen, said it is technically true that Progressive was not representing the driver who caused the crash. During the trial, though, Progressive’s attorney coordinated with the defense and put on witnesses who tried to undermine Kaitlynn Fisher’s case, Cohen said.
According to Cohen, it’s not necessarily unusual for an insurance company to go into court as an adversary of its client. But Cohen said it was unusual and wrong in this case because he believed that Progressive had ample reason to believe Kaitlynn was the victim, as well as a legal obligation of good faith toward its client. An independent witness at the scene testified that the other driver, Ronald K. Hope III of Baltimore, ran a red light and caused the accident. Even Hope’s insurer, Nationwide, also did not dispute that Hope was at fault and paid $25,000, the limit of its coverage, to the Fisher family”.
You’re right on, SWFL Agent! Further proof anyone can make bold statements on the Internet as “truth” and cause issues when in fact the carrier was merely doing what they were required to do. In this case, they HAD their insured’s back!
If Nationwide paid initially, whatever amount, that would indicate to me that there was no dispute on their part,at least,as to who was at fault.Progressive evidently came up with some conflicting witness statements. Well you decide what is going on!
I have to say over the years I’ve seen Progressive do some questionable things when it comes to paying (or not paying) claims.
Once I had two clients involved in an accident, clearly the one who ran the stop sign was at fault and ticketed, but since both were insured with Progressive they said due to the measured skid marks the unticketed driver was also 25% at fault due the speed he was driving. In reality the unticketed driver was not exceeding the speed limit as he was attempting to stop but had no insurance company to fight for him.
Progressive found both drivers at fault so they could charge at fault surcharges to both drivers. I’ve seen other claims where they have done the similar things.
Progressive does not always represent their client.
If the claims scenario you are describing is true, Progressive would not surcharge the driver that was found 25% responsible. Any accident where the insured is found to be less than 50% responsible is considered a not-at-fault accident.
Not living in MD I have a question about Progressive’s statement. Is there any reason they couldn’t have paid the UIM without a trial? It seems that the $100,000 payment would have been worth it to the company instead of receiving all the bad PR.
Great observation, Bill. I find it difficult to believe that Progressive felt their exposure was less than $75,000. The way UIM works, Progressive’s maximum payout is $75,000 — the difference between the $100,000 policy and the $25,000 policy held by the other party. Crazy, huh?
By playing hardball, Progressive made itself look bad in the public eye, ticked off a client and still wound up paying its limits. In fact, it may have paid out more than the $75,000. Remember, there was a verdict for $750,000.
Progressive would not be liable for more than the policy limit unless they could be shown as acting in bad faith. The portion not covered by her UIM would go against the other driver.
SO true, Scott!
The at fault driver’s insurance, Nationwide, paid their $25,000 because they were acting in good faith for their insured. $25,000 for a fatality is chump change. And good business on behalf of Nationwide, as the expense of trying the case would be costly.
Progressive didn’t do anything wrong from the sounds of it. They have an obligation to make sure they owe the money before they pay it, regardless of who’s making the claim.
Would you want your own insurance company following the lead of the “other carrier”…just because they acted first? Really?
Let’s consider becoming independant thinkers here- rather than jumping on the bandwagon of some celebrity who probably has very little knowledge of insurance CONTRACTS. His loss is sad, of course. Facts are facts, though – 2 witnesses to the same accident can see two completely different scenarios.
Nationwide may have thought that their driver wasn’t at fault at all. But paying $25,000 to secure a full and final release is absolutely nothing to even consider not doing.
Everyone criticizes insurance companies for not doing the “right thing” until it’s their own carrier who wants to pay a claim that their person is not at fault for- like Nationwide. Unless it was absolutely 100% clear that my driver wasn’t at fault, like a rear-end accident, then I’m going to pay that $25,000 fatality claim every day of the week. Why would I not pay $25,000 now for a full release and instead take a case to trial that even if I “win” still just costs me $50,000 in legal fees and expenses? I obviously wouldn’t.
In this case it appears to be an intersection/red-light case which is always he-said she-said. I think for $100,000 progressive considered paying the full thing. If they had $50,000 or $25,000 limits I have no doubt they would have paid the whole thing up front and avoid the costs of trial and bad PR.
I think Progressive’s statement is a disgrace to the business. Yes, they were technically a defendant in that they were providing the underinsured motorist coverage, but that doesn’t mean they have to go to court arguing the at-fault party’s position. What a stupid statement to make. We know the owner of Progressive is an ultra left-wing nut case. Is he now taking talking points from the greatest of buffoons Joe Biden????
Progressive is a publicly traded company, and as such is “owned” by its shareholders. Some of whom may,indeed be “ultra left wing nut cases.”. But there is no one “owner” of PGR.
While Progressive is correct that they had to intervene as a defendent, it never should have progressed that far for the following reasons: (No pun intended.)
1) Maryland is a contributory negligence state. You’re either 100% at fault, or 0% at fault. Nationwide paying limits up front is an admission of liability (the release, of course, will state otherwise) to the public. Progressive immediately looks like the villain.
2)Progressive should have stepped in, fronted NW’s limits, preserving their right to subrogation, and came out looking like the good guy.
3) Upon receiving notification that Nationwide paid their policy limits, knowing this was a fatality claim for a young adult–they should have paid limits and be done with it.
Instead, they have a huge public black eye. Not insurmountable, by any stretch of the imagination–State Farm survived the whole Katrina Whistle Blower scandal, and Progressive will survive this.
But ultimately, the public bad faith resulting in lost new business, or drops in customer retention, plus their own legal defense expenses may eclipse the money they were trying to save.
Maryland also allows first-party bad faith claims. They may end up having to defend against that as well. And those can get ridiculous when juries start assessing punitive damage awards…
“2)Progressive should have stepped in, fronted NW’s limits, preserving their right to subrogation, and came out looking like the good guy.”
Perhaps it might be a wee bit difficult to subrogate against someone whose insurance is used up?
“3) Upon receiving notification that Nationwide paid their policy limits, knowing this was a fatality claim for a young adult–they should have paid limits and be done with it.”
Yep, agree with this. $100K is pocket change for a claim like this. Progressive’s actions would be more defensible if the policy were seven figures.
“Perhaps it might be a wee bit difficult to subrogate against someone whose insurance is used up?”
You misunderstand how claims work–particularly subrogation actions.
If Progressive fronted (IE paid the UIM limits before NW paid their liabilty limits) then they have preserved the right to pursue both NW and the other driver in a subrogation action.
Usually this is done in one of two scenarios:
1) Customer service for a highly emotional/charged loss where it could be a publicized accident, or a victim who had a relationship with the company. (agent, employee, etc)
2) The claimant has assets that are out-of-sync with his insurance coverage. (Has state minimum limits, but owns multiple properties, vehicles…)
Sometimes the laws of the state dictate how one procedes in collecting on UM/UIM. Five years ago, I was going to file on my UM/UIM in a case where my 17 yr old son was thrown from the back of a truck as it flipped. He landed face first on the road. The driver was uninsured and he was driving a vehicle that a third friend had borrowed from his mother-in-law. There were steps that had to be taken in order for me to file on my UM/UIM. One of those steps was to file suit against the driver and the insurance company that insured the truck. It took three years to get it all sorted out. And all I wanted to do was file on my insurance that I pay for every month. My insurance company took an adversarial role and I had to hire an attorney just to get it sorted out.
the only one getting anything from this case is the attorney.
Case went to suit so the attorney is going to collect somwhere around 60% of settlement. If they paid limits would mean 60k to the attorney and 40k to the client’s estate.
The attorney costs are not outside the policy limits. There costs may be outside of the limits which is why the attorney said they got several ten of thousands beyond the limit of the policy. But the attorney fee(ie their cut) comes directly from the settlement.
@jon, the fee varies but usually 60% of the settlement is the going rate if a case goes to suit.
Somebody correct me if I am wrong. Insured had 25k Bi coverage. Victim had 100k UUM coverage. Nationwide paid the 25k and that’s 75k difference in insureds coverage and victims 100k uum per person coverage. I would have thought that Prog would only pay out the 75k. I also do not think the attorney’s cost is outside the policy limits.
that is correct because the judgement for 700k wasnt made against the insurance company. it was made against the motorist who hit her. But the attorney said that they got paid several tens of thousands beyond the limit of the policy. The only reason I could think for that would to cover the attorney costs.
If the insured only had minimum limits, he probably didn’t have much in the way of assets he needed to protect. An attorney surely would’nt have filed a large judgement against him unless there was some resonable expectation of recovering something. I am of the belief that the victims family received only a portion of the available uum protection that was afforded and their attorney received his/her portion out of that.
Its really hard to understand a case from what is released in the media. But my understanding is that in Maryland the attorney had no choice but to sue the other Motorist to get a judgement so the insurance company would be compelled to pay on the UIM policy. From what I read in Maryland a claimant cannot sue an insurance Company which is something I never heard of before.
It would be interesting to know if Progressive now subrogates to get a judgement against the at fault driver, as I believe they and their stockholders, would be entitled to do so.
The release the insured signed for Nationwide’s limits probably protects their insured. (As most BI releases tend to do.)
Normally what happens in a UIM claim is that the UIM company (Progressive) in this case, is notified that there is a limits offer from the at-fault carrier, and Progressive at that point has to approve the signing of the release. If they don’t approve, that is when they have the option to front NW’s limits to protect their subrogation right.
Once that release is signed, however–generally there’s no option to pursue the tort driver further.
In all my experice, if I am the UM carrier and am holding 75k, 25k by the Tortfeasor is paid already and I am dealing wiht my insured who is a dead, attractive woman…..I am paying out 100% of the time. A) its the right thing to do (unless it was some kind of intentional act B) from a customer service standpoint you owe it to the estate and their family who are also hopefully policy holders and will stay with you or will soon join you as you handled a tough situation well C) the litigtion cost would easily negate the 75k, so why no offer it up. Poor frontline handling that probably never triggered home office oversight due to the low “value”. I am sure this will costs Progressive million between the payout and lost business.
My mother was hit by a hit & run driver and lost her left eye and is permanently disfigured. Her carrier, USAA, paid $50k UM coverage with no questions asked.
The more Progressive attempts to explain this, the more foolish and craven they sound. The applicable law is nearly inexplicable to the average consumer, confirming everyone’s worst suspicions about insurers. Yes, so much for millions of dollars in advertising. Trust and common sense thrown overboard in favor of procedures. Sadly it is/was a disservice to the entire industry. Look for some different advertising messages, or maybe the old messages ring truer: Nationwide is on your side. Take THAT, Progressive.
1) start insurance company
2) go to ridiculous lengths to refuse to pay your customers
3) give a crappy apology that doesn’t even admit you were wrong
4) flat out lie in the face of court documents
5)??
6) Profit!
James, apparently your reading comprehension skills need brushing up. You are bashing Progressive for doing what the Maryland law said they were to do. If you don’t like the rules they have to follow then get the rules changed!
I think Flo needs to start looking for a new job, as Progressive is going down. If your insurance company won’t stand behind you, you need a different insurance company. This reminds me of Allstate when they tried to sell flooded cares.
Great comments. Now go back and read the article and try again.
Information from another online insurance periodical includes the following info. there was a lot more info available than what was in the article in IJ. Seems slike Progressive has a problem here, especially with what Nationwide did.
“The Fisher family’s lawyer, Annapolis, Md.-based attorney Allen Cohen, said it is technically true that Progressive was not representing the driver who caused the crash. During the trial, though, Progressive’s attorney coordinated with the defense and put on witnesses who tried to undermine Kaitlynn Fisher’s case, Cohen said.
According to Cohen, it’s not necessarily unusual for an insurance company to go into court as an adversary of its client. But Cohen said it was unusual and wrong in this case because he believed that Progressive had ample reason to believe Kaitlynn was the victim, as well as a legal obligation of good faith toward its client. An independent witness at the scene testified that the other driver, Ronald K. Hope III of Baltimore, ran a red light and caused the accident. Even Hope’s insurer, Nationwide, also did not dispute that Hope was at fault and paid $25,000, the limit of its coverage, to the Fisher family”.
You’re right on, SWFL Agent! Further proof anyone can make bold statements on the Internet as “truth” and cause issues when in fact the carrier was merely doing what they were required to do. In this case, they HAD their insured’s back!
If Nationwide paid initially, whatever amount, that would indicate to me that there was no dispute on their part,at least,as to who was at fault.Progressive evidently came up with some conflicting witness statements. Well you decide what is going on!
I have to say over the years I’ve seen Progressive do some questionable things when it comes to paying (or not paying) claims.
Once I had two clients involved in an accident, clearly the one who ran the stop sign was at fault and ticketed, but since both were insured with Progressive they said due to the measured skid marks the unticketed driver was also 25% at fault due the speed he was driving. In reality the unticketed driver was not exceeding the speed limit as he was attempting to stop but had no insurance company to fight for him.
Progressive found both drivers at fault so they could charge at fault surcharges to both drivers. I’ve seen other claims where they have done the similar things.
Progressive does not always represent their client.
If the claims scenario you are describing is true, Progressive would not surcharge the driver that was found 25% responsible. Any accident where the insured is found to be less than 50% responsible is considered a not-at-fault accident.
Not living in MD I have a question about Progressive’s statement. Is there any reason they couldn’t have paid the UIM without a trial? It seems that the $100,000 payment would have been worth it to the company instead of receiving all the bad PR.
No, there’s no reason they couldn’t have paid the limits up front.
In fact, good business practice says that they *should* have.
But “good” and “practice” might be foreign words to how Progressive operates in the Northeast.
Great observation, Bill. I find it difficult to believe that Progressive felt their exposure was less than $75,000. The way UIM works, Progressive’s maximum payout is $75,000 — the difference between the $100,000 policy and the $25,000 policy held by the other party. Crazy, huh?
By playing hardball, Progressive made itself look bad in the public eye, ticked off a client and still wound up paying its limits. In fact, it may have paid out more than the $75,000. Remember, there was a verdict for $750,000.
Progressive would not be liable for more than the policy limit unless they could be shown as acting in bad faith. The portion not covered by her UIM would go against the other driver.
SO true, Scott!
The at fault driver’s insurance, Nationwide, paid their $25,000 because they were acting in good faith for their insured. $25,000 for a fatality is chump change. And good business on behalf of Nationwide, as the expense of trying the case would be costly.
Progressive didn’t do anything wrong from the sounds of it. They have an obligation to make sure they owe the money before they pay it, regardless of who’s making the claim.
Would you want your own insurance company following the lead of the “other carrier”…just because they acted first? Really?
Let’s consider becoming independant thinkers here- rather than jumping on the bandwagon of some celebrity who probably has very little knowledge of insurance CONTRACTS. His loss is sad, of course. Facts are facts, though – 2 witnesses to the same accident can see two completely different scenarios.
Finally some people are making sense here.
Nationwide may have thought that their driver wasn’t at fault at all. But paying $25,000 to secure a full and final release is absolutely nothing to even consider not doing.
Everyone criticizes insurance companies for not doing the “right thing” until it’s their own carrier who wants to pay a claim that their person is not at fault for- like Nationwide. Unless it was absolutely 100% clear that my driver wasn’t at fault, like a rear-end accident, then I’m going to pay that $25,000 fatality claim every day of the week. Why would I not pay $25,000 now for a full release and instead take a case to trial that even if I “win” still just costs me $50,000 in legal fees and expenses? I obviously wouldn’t.
In this case it appears to be an intersection/red-light case which is always he-said she-said. I think for $100,000 progressive considered paying the full thing. If they had $50,000 or $25,000 limits I have no doubt they would have paid the whole thing up front and avoid the costs of trial and bad PR.
I think Progressive’s statement is a disgrace to the business. Yes, they were technically a defendant in that they were providing the underinsured motorist coverage, but that doesn’t mean they have to go to court arguing the at-fault party’s position. What a stupid statement to make. We know the owner of Progressive is an ultra left-wing nut case. Is he now taking talking points from the greatest of buffoons Joe Biden????
Progressive is a publicly traded company, and as such is “owned” by its shareholders. Some of whom may,indeed be “ultra left wing nut cases.”. But there is no one “owner” of PGR.
While Progressive is correct that they had to intervene as a defendent, it never should have progressed that far for the following reasons: (No pun intended.)
1) Maryland is a contributory negligence state. You’re either 100% at fault, or 0% at fault. Nationwide paying limits up front is an admission of liability (the release, of course, will state otherwise) to the public. Progressive immediately looks like the villain.
2)Progressive should have stepped in, fronted NW’s limits, preserving their right to subrogation, and came out looking like the good guy.
3) Upon receiving notification that Nationwide paid their policy limits, knowing this was a fatality claim for a young adult–they should have paid limits and be done with it.
Instead, they have a huge public black eye. Not insurmountable, by any stretch of the imagination–State Farm survived the whole Katrina Whistle Blower scandal, and Progressive will survive this.
But ultimately, the public bad faith resulting in lost new business, or drops in customer retention, plus their own legal defense expenses may eclipse the money they were trying to save.
Maryland also allows first-party bad faith claims. They may end up having to defend against that as well. And those can get ridiculous when juries start assessing punitive damage awards…
“2)Progressive should have stepped in, fronted NW’s limits, preserving their right to subrogation, and came out looking like the good guy.”
Perhaps it might be a wee bit difficult to subrogate against someone whose insurance is used up?
“3) Upon receiving notification that Nationwide paid their policy limits, knowing this was a fatality claim for a young adult–they should have paid limits and be done with it.”
Yep, agree with this. $100K is pocket change for a claim like this. Progressive’s actions would be more defensible if the policy were seven figures.
“Perhaps it might be a wee bit difficult to subrogate against someone whose insurance is used up?”
You misunderstand how claims work–particularly subrogation actions.
If Progressive fronted (IE paid the UIM limits before NW paid their liabilty limits) then they have preserved the right to pursue both NW and the other driver in a subrogation action.
Usually this is done in one of two scenarios:
1) Customer service for a highly emotional/charged loss where it could be a publicized accident, or a victim who had a relationship with the company. (agent, employee, etc)
2) The claimant has assets that are out-of-sync with his insurance coverage. (Has state minimum limits, but owns multiple properties, vehicles…)
Sometimes the laws of the state dictate how one procedes in collecting on UM/UIM. Five years ago, I was going to file on my UM/UIM in a case where my 17 yr old son was thrown from the back of a truck as it flipped. He landed face first on the road. The driver was uninsured and he was driving a vehicle that a third friend had borrowed from his mother-in-law. There were steps that had to be taken in order for me to file on my UM/UIM. One of those steps was to file suit against the driver and the insurance company that insured the truck. It took three years to get it all sorted out. And all I wanted to do was file on my insurance that I pay for every month. My insurance company took an adversarial role and I had to hire an attorney just to get it sorted out.
Yep, UM is adversarial by nature. That’s why states require that auto carriers offer it, because many of them would not if they weren’t required to.
the only one getting anything from this case is the attorney.
Case went to suit so the attorney is going to collect somwhere around 60% of settlement. If they paid limits would mean 60k to the attorney and 40k to the client’s estate.
Who would be stupid enough to sign a 60% fee agreement if something goes to litigation?
The attorney costs are outside the policy limits. The family gets $100,000 and does not get their daughter back. The other driver should do jail time.
The attorney costs are not outside the policy limits. There costs may be outside of the limits which is why the attorney said they got several ten of thousands beyond the limit of the policy. But the attorney fee(ie their cut) comes directly from the settlement.
@jon, the fee varies but usually 60% of the settlement is the going rate if a case goes to suit.
Somebody correct me if I am wrong. Insured had 25k Bi coverage. Victim had 100k UUM coverage. Nationwide paid the 25k and that’s 75k difference in insureds coverage and victims 100k uum per person coverage. I would have thought that Prog would only pay out the 75k. I also do not think the attorney’s cost is outside the policy limits.
that is correct because the judgement for 700k wasnt made against the insurance company. it was made against the motorist who hit her. But the attorney said that they got paid several tens of thousands beyond the limit of the policy. The only reason I could think for that would to cover the attorney costs.
If the insured only had minimum limits, he probably didn’t have much in the way of assets he needed to protect. An attorney surely would’nt have filed a large judgement against him unless there was some resonable expectation of recovering something. I am of the belief that the victims family received only a portion of the available uum protection that was afforded and their attorney received his/her portion out of that.
Its really hard to understand a case from what is released in the media. But my understanding is that in Maryland the attorney had no choice but to sue the other Motorist to get a judgement so the insurance company would be compelled to pay on the UIM policy. From what I read in Maryland a claimant cannot sue an insurance Company which is something I never heard of before.
I have enjoyed the comments. Think I’ll sign off and let Flo sort it out.
It would be interesting to know if Progressive now subrogates to get a judgement against the at fault driver, as I believe they and their stockholders, would be entitled to do so.
The release the insured signed for Nationwide’s limits probably protects their insured. (As most BI releases tend to do.)
Normally what happens in a UIM claim is that the UIM company (Progressive) in this case, is notified that there is a limits offer from the at-fault carrier, and Progressive at that point has to approve the signing of the release. If they don’t approve, that is when they have the option to front NW’s limits to protect their subrogation right.
Once that release is signed, however–generally there’s no option to pursue the tort driver further.
In all my experice, if I am the UM carrier and am holding 75k, 25k by the Tortfeasor is paid already and I am dealing wiht my insured who is a dead, attractive woman…..I am paying out 100% of the time. A) its the right thing to do (unless it was some kind of intentional act B) from a customer service standpoint you owe it to the estate and their family who are also hopefully policy holders and will stay with you or will soon join you as you handled a tough situation well C) the litigtion cost would easily negate the 75k, so why no offer it up. Poor frontline handling that probably never triggered home office oversight due to the low “value”. I am sure this will costs Progressive million between the payout and lost business.
My mother was hit by a hit & run driver and lost her left eye and is permanently disfigured. Her carrier, USAA, paid $50k UM coverage with no questions asked.
Other driver RAN a RED light…not at fault..and Progressive plays games..yeah right!
No wonder our clients think insurance companies are dishonest! Not surprised!
The more Progressive attempts to explain this, the more foolish and craven they sound. The applicable law is nearly inexplicable to the average consumer, confirming everyone’s worst suspicions about insurers. Yes, so much for millions of dollars in advertising. Trust and common sense thrown overboard in favor of procedures. Sadly it is/was a disservice to the entire industry. Look for some different advertising messages, or maybe the old messages ring truer: Nationwide is on your side. Take THAT, Progressive.
Progressive should be ashamed of themselves.
Let’s see…
1) start insurance company
2) go to ridiculous lengths to refuse to pay your customers
3) give a crappy apology that doesn’t even admit you were wrong
4) flat out lie in the face of court documents
5)??
6) Profit!
James, apparently your reading comprehension skills need brushing up. You are bashing Progressive for doing what the Maryland law said they were to do. If you don’t like the rules they have to follow then get the rules changed!