I would love to see how some of these people would run an insurance company. I can guarantee they would change their minds in a heartbeat! You wouldnt see them writting checks left and right. Nope, they would handle it the same way… As a business and under the guidelines and rules of the state!
I agree with John and Nobody. Anyone who has worked on the insurance end of a claim settlement knows the difficulties and how the cards are stacked against you.
Brilliant. Cards stacked against the insurers? Passion that defies logic?
Better check those insurance record profits for the last several years, INCLUDING years of Katrina and Rita.
Anyone that sides with an insurer that loses all the appeals for the court ruling that required them to produce the documents, then sees it “logical” to release the defendant for the fines that the court imposed for defying the court’s original order is certainly operating under some form of “logic”, but it isn’t one that exists in any sane person’s mind, only in the minds of big insurance that feels they are above the law.
The real irony is, it’s painfully obvious that big insurance is, in fact, above the law. At least above the ones that the average person must obey.
Imagine if an average insured consumer off the street defied a court order like this. Do you really believe that they would be released from the court order and it’s fines, or tossed in jail in a heartbeat for defying the court order?
As a person that deals with insureds, and insurers, daily, I see both sides. And I can state from experience, that the insurers are the ones that need to be reigned in, not insureds. Daily I see claims lowballed by 50%, policy terms that do not exist “enforced”, claimants that are unable to confirm coverage for weeks, claims that are not paid within state timely payment of claims laws, blatant fraud committed by insurers against their own insureds defined specifically by state laws, and finally, a total lack of enforcement by state officials that mostly come from the insurance industry and are placed into regulatory positions.
Insurers simply need to have their feet held to the fire to deliver what they sold. Indemnification.
To that point: How can it be explained that insurers are still selling hurricane coverage that excludes both wind, and water?
The “Four D’s” are fully in play: Delay, Deny, Defend, and finally, Deflect, by the insurers.
The average person cannot possibly hope for justice when fighting a Goliath that has the court system both bought and paid for.
Insurer’s hands tied? Passion with no logic? Stand in the shoes of a claimant who has just lost everything and then finds out the coverage they paid for for decades is only worth a fraction of what they thought it was, or what the policy actually states, and your views may change quickly. If you tell me you have been a claimant and had no complaints, then it will be obvious to me that you were treated differently because you work for the insurance industry.
This is as clueless and uninformed a post as I have seen in some time. There are no facts in your post. That is my informed opinion. Who are you, a trial lawyer or Robert Hunter?
Trial lawyer or Robert Hunter? LOL That’s just too funny. Why would you assume such?
The facts of denials, lowballing, industry profits, and lack of enforcement by regulators are common and are available on the internet through news articles, insurance industry press releases, and finally court documents; none of which involve trial lawyers sites or Mr. Hunter or internet blogs. My personal dealings with insurers and consumers alike bring the revelations that there is truth to the allegations. Do your own research, you need not take my word for anything.
To the rest, obviously, I will not post details of individuals confidential claims information to justify to you my facts; but then you already knew that, hence your baited reply to get me to do so to then discredit my post as having lack of facts.
My information and facts go to proper authorities, thank you.
These “lowball” offers you refer to are not the stragetic masterminding of the insurance company as you see them. Anyone who knows the first thing about insurance estimating knows that pricing for FIRST party settlement is based on estimating software that is used across both the insurance and construction industries.
Then, perhaps, Two Cents, you might explain why insurers have their own versions of software while repair vendors have different versions of the same supposed software?
You might also explain why insurers sit on advisory committees to these software vendors, but repair vendors don’t?
You need to do some of your own research also.
You might also check to see who some of the private investors are that are now in ownership of those software/estimating vendors.
Finally, there are some that have been watching closely the manipulation of the databases in those software systems of which you speak.
Oh, and BTW, those are “estimating guides” not bibles.
Doesn’t anyone see the reason and logic in fairly and quickly settling claims? The more you drag your feet and stall, the greater the likelihood of ‘bad blood’, attorney involvement, and increased allocated loss adjustment expense. You don’t build a longstanding successful business by repeatedly ripping off your customer base. You also don’t build it by handing your company checkbook over to your insureds.
I have never worked personal lines which may be very different but at all the commercial carriers I’ve been with, nobody was out to get the customer.
I am not so blind as to think some insurance companies do not manipulate these programs. I worked for medium sized P&C carrier handling property losses. We did just what you eluded to- used the software as a guide. I think you will find that the claims where settlement could not be reached was when a contractor not using any estimating software was involved. These contractors must be paid attention to as they often set thier own prices.
I take exception when someone takes the behavior of one company(or group of companies) and labels all companies in the same industry the same. This is no different than stereotyping based on age, sex, race, etc. The lesson that can be learned from this discussion is that not ALL companies behave in the manner that the companies which gain media attention do.
The documents in question were the famous McKinsey consults. Now that they are openly available, where is the outrage regarding their contents? There is no outrage because there is and never was a smoking gun. There is no trade advantage in the report now as many companies have followed similar advice in structuring their claims departments.
If the industry is so awful (and we are not), why are the complaint ratios so low? This is public information in most or all states. And Allstate’s complaint ratio is just ordinary, unfortunately no better but still no worse than the competition. I am proud of the work I do and proud to represent the company I do.
Granted, Two Cents, that not all companies are paintable with the same brush. The same holds true of consumers, shops, and vendors also.
However, your point of “watching” vendors that “set their own prices” is startling.
Who should set a repair vendor’s prices, if not the vendor; the repair expert, the one conducting the actual repairs and assuming the liability for those repairs?
Insurers set their own prices which vary greatly depending upon the insurer, more than just the actual amounts of coverage. Any web search will prove such. The quality and level of service (and the fine print or lack of exclusions) by the higher priced insurer is usually higher, and so is the higher priced vendor. In other words, you get what you pay for is still an adage that holds true today, possibly more than ever before.
I have found that vendors that do not use the estimating guides are usually much more in touch with the actual costs involved in the repair, and watching their costs much more closely, and providing much more accurate estimates, and finally, repair bills, simply because they don’t use the “guides”. Old fashioned, perhaps, but also thorough.
Again, who should be “setting” those repair vendor’s pricing if not themselves?
Mark1, Insurance claims are not completely free-market. The claimant has a duty to mitigate damages that does not allow them to simply pick the highest price shop or vendor when the prevailing costs are, in general, lower. The insurance company is simply a surrogate for the person claimed against.
In the absence of your insurer paying your parking lot fender-bender on your behalf, don’t you want some sort of reasonable cap on what you have to pay? As your surrogate, your company is entitled to the same protection under law. These reduced costs not only affect the company’s bottom line, they affect the future rates charged for your insurance.
Respectfully, I don’t believe the duty to mitigate the damages in the policy involves choosing the least expensive repairer. I believe that clause involves protecting the property from further damages, such as exposure to water, and theft, after a loss such as a motor vehicle accident or a tree that falls through a window. The duty of the insured is to secure the property and protect it from further damage, and therefore mitigate the loss.
The assumption that all repairs are the same or that the lowest bidding repair vendor is supplying the same actual repairs and quality of repairs as a higher priced repair vendor, is the problem.
Those software systems that were spoken of do not ensure that first, all the actual damage is written, and second that all the damage was written properly.
The policy promises to indemnify the consumer, not to indemnify the company’s insureds as a whole with lower rates.
I will agree with Mark1 that the insured should be required to find the best price when mitigating damages. During time period following losses, the resources are not available. However, when searching for a vendor for permanent repairs, the insured should do thier part in claim settlement by finding a vendor with reasonable procing.
You misunderstand my point Mark1. The duty to mitigate is found in the Fair Claims Practices Acts in the various states, not in the policies themselves. You are correct in seeing that the insured has a contractual duty to protect the property from further loss. In addition to that however, the claimant has a duty under law to cooperate with minimizing the loss costs in total. This does NOT dictate that they use the cheapest vendor, it requires reasonableness. Admittedly difficult in the heat of a contested claim.
“Fair” is not a one-sided concept.
Excuse me, Two Cents, but I didn’t say that the insured should be required to find the best price on repairs.
The insured has the right to find the best VALUE for repairs for his property, and the lowest price may not indemnify him nor restore him to preloss. In fact, most states give the insured the right to choose the repair vendor by law, especially in motor vehicle repairs.
The adjuster should be determining what returns the claimant to preloss condition, without ambiguous terms not in the policy. The software may not do this.
The solution is simple: All the insurer has to do is invoke the right to repair in the policy, and repair the property for the insured, and then return the property to the insured after it is repaired.
Of course, we all know why this does not happen, because the insurer would then assume all liability for the repairs done to the insured’s property.
In the current situations, the repair vendor is assuming the liability for repairs, while the insurer enjoys the low price.
But the mixing of two options under the policy, the option to repair, and the option to pay monies for repair, is taking place.
I have no doubt that this saves the insurer money, but question whether, in the face of record profits, if these savings are actually passed back to the consumer, or if diminishing the value of the indemnifcation sold to a claimant in the name of lowering premiums for all policyholders is a sound practice as well, let alone actually in the policy contract.
Fair Claims Practices and Bad Faith Claims Practices acts apply to insurers.
Fraudulent Claims apply to consumers and insurers alike. (in most states, Texas being an exception)
I know of no state law that states it is an insured’s duty to assist in mitigating the value of a loss. Policy terms and conditions, to mitigate damage and further damage to property, yes, but state law on either value or further damage, no.
I would ask that you post some of these laws of which you speak for review, in that they are public documents.
So, in the end, no real penalty for stonewalling and obstruction? This only encourages repeat performances and more of the same.
Wiat until you see what they do next time.
Chump justice.
Media moron strikes again. You have to love consistency. This person hates insurers with a passion. No logic or sense, but lot’s of passion.
I would love to see how some of these people would run an insurance company. I can guarantee they would change their minds in a heartbeat! You wouldnt see them writting checks left and right. Nope, they would handle it the same way… As a business and under the guidelines and rules of the state!
I agree with John and Nobody. Anyone who has worked on the insurance end of a claim settlement knows the difficulties and how the cards are stacked against you.
Brilliant. Cards stacked against the insurers? Passion that defies logic?
Better check those insurance record profits for the last several years, INCLUDING years of Katrina and Rita.
Anyone that sides with an insurer that loses all the appeals for the court ruling that required them to produce the documents, then sees it “logical” to release the defendant for the fines that the court imposed for defying the court’s original order is certainly operating under some form of “logic”, but it isn’t one that exists in any sane person’s mind, only in the minds of big insurance that feels they are above the law.
The real irony is, it’s painfully obvious that big insurance is, in fact, above the law. At least above the ones that the average person must obey.
Imagine if an average insured consumer off the street defied a court order like this. Do you really believe that they would be released from the court order and it’s fines, or tossed in jail in a heartbeat for defying the court order?
As a person that deals with insureds, and insurers, daily, I see both sides. And I can state from experience, that the insurers are the ones that need to be reigned in, not insureds. Daily I see claims lowballed by 50%, policy terms that do not exist “enforced”, claimants that are unable to confirm coverage for weeks, claims that are not paid within state timely payment of claims laws, blatant fraud committed by insurers against their own insureds defined specifically by state laws, and finally, a total lack of enforcement by state officials that mostly come from the insurance industry and are placed into regulatory positions.
Insurers simply need to have their feet held to the fire to deliver what they sold. Indemnification.
To that point: How can it be explained that insurers are still selling hurricane coverage that excludes both wind, and water?
The “Four D’s” are fully in play: Delay, Deny, Defend, and finally, Deflect, by the insurers.
The average person cannot possibly hope for justice when fighting a Goliath that has the court system both bought and paid for.
Insurer’s hands tied? Passion with no logic? Stand in the shoes of a claimant who has just lost everything and then finds out the coverage they paid for for decades is only worth a fraction of what they thought it was, or what the policy actually states, and your views may change quickly. If you tell me you have been a claimant and had no complaints, then it will be obvious to me that you were treated differently because you work for the insurance industry.
That’s my viewpoint.
This is as clueless and uninformed a post as I have seen in some time. There are no facts in your post. That is my informed opinion. Who are you, a trial lawyer or Robert Hunter?
A typical, predictable, and expected reply.
Trial lawyer or Robert Hunter? LOL That’s just too funny. Why would you assume such?
The facts of denials, lowballing, industry profits, and lack of enforcement by regulators are common and are available on the internet through news articles, insurance industry press releases, and finally court documents; none of which involve trial lawyers sites or Mr. Hunter or internet blogs. My personal dealings with insurers and consumers alike bring the revelations that there is truth to the allegations. Do your own research, you need not take my word for anything.
To the rest, obviously, I will not post details of individuals confidential claims information to justify to you my facts; but then you already knew that, hence your baited reply to get me to do so to then discredit my post as having lack of facts.
My information and facts go to proper authorities, thank you.
These “lowball” offers you refer to are not the stragetic masterminding of the insurance company as you see them. Anyone who knows the first thing about insurance estimating knows that pricing for FIRST party settlement is based on estimating software that is used across both the insurance and construction industries.
Then, perhaps, Two Cents, you might explain why insurers have their own versions of software while repair vendors have different versions of the same supposed software?
You might also explain why insurers sit on advisory committees to these software vendors, but repair vendors don’t?
You need to do some of your own research also.
You might also check to see who some of the private investors are that are now in ownership of those software/estimating vendors.
Finally, there are some that have been watching closely the manipulation of the databases in those software systems of which you speak.
Oh, and BTW, those are “estimating guides” not bibles.
Doesn’t anyone see the reason and logic in fairly and quickly settling claims? The more you drag your feet and stall, the greater the likelihood of ‘bad blood’, attorney involvement, and increased allocated loss adjustment expense. You don’t build a longstanding successful business by repeatedly ripping off your customer base. You also don’t build it by handing your company checkbook over to your insureds.
I have never worked personal lines which may be very different but at all the commercial carriers I’ve been with, nobody was out to get the customer.
I am not so blind as to think some insurance companies do not manipulate these programs. I worked for medium sized P&C carrier handling property losses. We did just what you eluded to- used the software as a guide. I think you will find that the claims where settlement could not be reached was when a contractor not using any estimating software was involved. These contractors must be paid attention to as they often set thier own prices.
I take exception when someone takes the behavior of one company(or group of companies) and labels all companies in the same industry the same. This is no different than stereotyping based on age, sex, race, etc. The lesson that can be learned from this discussion is that not ALL companies behave in the manner that the companies which gain media attention do.
The documents in question were the famous McKinsey consults. Now that they are openly available, where is the outrage regarding their contents? There is no outrage because there is and never was a smoking gun. There is no trade advantage in the report now as many companies have followed similar advice in structuring their claims departments.
If the industry is so awful (and we are not), why are the complaint ratios so low? This is public information in most or all states. And Allstate’s complaint ratio is just ordinary, unfortunately no better but still no worse than the competition. I am proud of the work I do and proud to represent the company I do.
Granted, Two Cents, that not all companies are paintable with the same brush. The same holds true of consumers, shops, and vendors also.
However, your point of “watching” vendors that “set their own prices” is startling.
Who should set a repair vendor’s prices, if not the vendor; the repair expert, the one conducting the actual repairs and assuming the liability for those repairs?
Insurers set their own prices which vary greatly depending upon the insurer, more than just the actual amounts of coverage. Any web search will prove such. The quality and level of service (and the fine print or lack of exclusions) by the higher priced insurer is usually higher, and so is the higher priced vendor. In other words, you get what you pay for is still an adage that holds true today, possibly more than ever before.
I have found that vendors that do not use the estimating guides are usually much more in touch with the actual costs involved in the repair, and watching their costs much more closely, and providing much more accurate estimates, and finally, repair bills, simply because they don’t use the “guides”. Old fashioned, perhaps, but also thorough.
Again, who should be “setting” those repair vendor’s pricing if not themselves?
I believe it is only fair that the same regulation that insurance companies face should also be present for other industries(i.e. construction).
Mark1, Insurance claims are not completely free-market. The claimant has a duty to mitigate damages that does not allow them to simply pick the highest price shop or vendor when the prevailing costs are, in general, lower. The insurance company is simply a surrogate for the person claimed against.
In the absence of your insurer paying your parking lot fender-bender on your behalf, don’t you want some sort of reasonable cap on what you have to pay? As your surrogate, your company is entitled to the same protection under law. These reduced costs not only affect the company’s bottom line, they affect the future rates charged for your insurance.
Good Hands,
Respectfully, I don’t believe the duty to mitigate the damages in the policy involves choosing the least expensive repairer. I believe that clause involves protecting the property from further damages, such as exposure to water, and theft, after a loss such as a motor vehicle accident or a tree that falls through a window. The duty of the insured is to secure the property and protect it from further damage, and therefore mitigate the loss.
The assumption that all repairs are the same or that the lowest bidding repair vendor is supplying the same actual repairs and quality of repairs as a higher priced repair vendor, is the problem.
Those software systems that were spoken of do not ensure that first, all the actual damage is written, and second that all the damage was written properly.
The policy promises to indemnify the consumer, not to indemnify the company’s insureds as a whole with lower rates.
I will agree with Mark1 that the insured should be required to find the best price when mitigating damages. During time period following losses, the resources are not available. However, when searching for a vendor for permanent repairs, the insured should do thier part in claim settlement by finding a vendor with reasonable procing.
You misunderstand my point Mark1. The duty to mitigate is found in the Fair Claims Practices Acts in the various states, not in the policies themselves. You are correct in seeing that the insured has a contractual duty to protect the property from further loss. In addition to that however, the claimant has a duty under law to cooperate with minimizing the loss costs in total. This does NOT dictate that they use the cheapest vendor, it requires reasonableness. Admittedly difficult in the heat of a contested claim.
“Fair” is not a one-sided concept.
Excuse me, Two Cents, but I didn’t say that the insured should be required to find the best price on repairs.
The insured has the right to find the best VALUE for repairs for his property, and the lowest price may not indemnify him nor restore him to preloss. In fact, most states give the insured the right to choose the repair vendor by law, especially in motor vehicle repairs.
The adjuster should be determining what returns the claimant to preloss condition, without ambiguous terms not in the policy. The software may not do this.
The solution is simple: All the insurer has to do is invoke the right to repair in the policy, and repair the property for the insured, and then return the property to the insured after it is repaired.
Of course, we all know why this does not happen, because the insurer would then assume all liability for the repairs done to the insured’s property.
In the current situations, the repair vendor is assuming the liability for repairs, while the insurer enjoys the low price.
But the mixing of two options under the policy, the option to repair, and the option to pay monies for repair, is taking place.
I have no doubt that this saves the insurer money, but question whether, in the face of record profits, if these savings are actually passed back to the consumer, or if diminishing the value of the indemnifcation sold to a claimant in the name of lowering premiums for all policyholders is a sound practice as well, let alone actually in the policy contract.
Good Hands,
I believe you are in error.
Fair Claims Practices and Bad Faith Claims Practices acts apply to insurers.
Fraudulent Claims apply to consumers and insurers alike. (in most states, Texas being an exception)
I know of no state law that states it is an insured’s duty to assist in mitigating the value of a loss. Policy terms and conditions, to mitigate damage and further damage to property, yes, but state law on either value or further damage, no.
I would ask that you post some of these laws of which you speak for review, in that they are public documents.