AIG will not fail. They are a big strong insurance company. When they clean out the mess made by the financial services division they will be just fine. The Gov just loaned them 126 Billon and we are worried about $400,000 in agent earned recreation. Get a life. People sell and are rewarded for doing so. I have no problem except with Henry Waxman who will not miss a chance to go after a big business. What a joke!!!
Mad as HECK you might want to check from (TRUTH OUT) Freddie Mac, secretly paid a REPUBLICAN FIRM to kill legislation $2 MILLION , the firm name is DCI, even after Sen. Chuck Hagel put up leislation
You missed the point of the post. Corporations will act inapropriate, carelessly risky, corupt and posibly illegal. The way the world works is these companies do not survive and go bankrupt. Well we just converted from the free market economy to socialism. Now these companies are rewarded and get as many chances as they want to get it right.They can be as risky as they want, without consequence. What is to stop the 9 banks who were forced to take 25 billion each with no restrictions on what they can do with it. I heard the CEO of Bank of America say they plan to buy up smaller banks with the money, I would be upset if I were a competitor of BOA. Thats why I bought AIG, They now cannot lose, Just win. My point is, Thats not right. Oh well, I will just invest where ever the Government says they will not let the company go under and buy a blue chip stock at a penny stock price.
TO THE UNTOUCHABLES. Edward B. Rust, Jr., will be happy to tell you that he is the Chief Executive Officer of State Farm Mutual Insurance Company. He has deep family ties to State Farm, as his father and grand father have both served in that capacity. He will also tell you that he is an educated man who has been to law school and is a past practicing attorney. In addition, he was the chairman of the Coalition for Excellence in Education and a member of George W. Bush’s transition advisory team on education. So with all of that education why will he not deal with his company’s inbred greed. Does he not know that we are in the 21st century where anyone can look on the internet and see the billions of dollars that are being spent to protect their empire from the consumer? In Utah, the company was fine $25 million in punitive damages, in part for the “systematic destruction of documents and systematic manipulation of individual claim files to conceal claim mishandling”. An Idaho appeals court fined the company $9.5 million in punitive damages for making use of “a completely bogus” outside bill review company that helped lower the cost of medical bills. In October of 1999, an Illinois jury rendered a $456 million judgment against State Farm and an additional $730 million in punitive damages for the insurer’s breach of contract with auto policy holders by relying on generic replacement parts. Rust was adamant in his insistence that fraud had not been committed. A class action law suit in the name of State Farm policy holders was filed in 2003 for breach of contract and statutory consumer fraud in which $1.1 billion was awarded to plaintiffs. When a company is misleading the public, should that not be considered fraud? A consumer would go to prison for that type of behavior. State Farm will let you know that, in several states, fraud and abuse is pushing up the cost of auto insurance. A court in late 2001 reached an unfriendly consumer decision that could have the effect of reaching deep into the pockets of the consumer. Sharply higher jury awards in vehicular liability cases are putting additional upward pressure on auto insurance rates. The average jury award in auto liability cases rose from $187,000 to $269,000 in 2000, an increase of 44%. I question if any of the lawsuits would be necessary if the company would just fairly pay their claims. The company represents on their web-site that consumer protection is one of their most important goals, but do they really think that courts would be awarding multiple millions of dollars in bad faith claims if that were their emphasis? State Farm’s ratings are based on their financial strength. State Farm states that their high ratings are also based on strong claims paying ability. With this ability, why is it necessary for their policy holders to allege that the claims department was directed, in evaluating their cases, to take them to trial instead of settling within the limits of the policy? This practice exposed policyholders to judgments above the limits of their policies, when the company was attempting to make an effort to win smaller decisions. Two former in-house attorneys for State Farm contend that they were often called upon by the insurer to represent its’ policy holders and were forced to commit “unlawful and unethical activities, including requiring the two to stay silent about the rights of the policyholders”. State Farm seems to have reckless indifference for the truth for the purpose of corporate and personal economic gain. State Farm should know that continued scrutiny of their claims paying practices will continue especially with the advent of new claims that are surfacing from lawsuits revolving around Hurricane Katrina. A message to Mr. Rust, and any employee of the company that is acting in bad faith for its policy holders. Its time to stop no more. Each time there has been deregulation of these industries who wins ???
God has said nothing about regulation. If you like regulation, God should send you here in Florida. Our Governor has run off all the good carriers writing homeowners and the State is the largest carrier. There is no private market rated by Best rating offering to write homeowners. Thats what excessive regulation will get you. By the way State Farm is one of the finest Personal lines carriers in the country. Thats why they are the largest and sued the most. They are dealing with an aggressive legal environments and pricing preasure to either look for ways to save on claims or raise their rates. They have chosen to look for ways to save on claims.
BILOXI, Miss. (MCT) — In some cases, State Farm’s top leadership prefers not to share or even keep records that offer insight into how policyholder claims are handled, according to court records.
Chairman and CEO Edward B. Rust Jr. said in sworn testimony earlier this month that no minutes are kept of quarterly meetings held by the company’s top management, the Chairman’s Council, and that policyholders have no right to information about an investigation State Farm Insurance Cos. has ordered of its relationship with Haag Engineering Co.
State Farm spokesman Phil Supple said the company doesn’t “intend to-;try this-;case in the media.”
“State Farm stands by testimony given by President and Vice Chairman Vince Trosino, who said when asked about these allegations, ‘It’s not part of our system. It’s not part of our core values. It’s not what made us the most successful property and casualty insurer, life insurer, in the country.'”
Juries in two states, Texas and Oklahoma, have found Haag provided biased reports to State Farm to minimize or deny policyholder claims. Mississippi’s attorney general currently is conducting a grand jury investigation to determine whether State Farm and other insurers denied Hurricane Katrina claims through the use of fraudulent engineering reports.
Haag denies bias, but State Farm suspended business with the company in June and ordered an independent investigation after an Oklahoma jury awarded a total of $13 million to a policyholder over tornado damages. Subsequent trials are set to determine damages for 70 other policyholders, all of whom had claims investigated by Haag.
In past court cases, judges have chastised and even fined State Farm for withholding records the company was ordered to produce. Evidence the company destroyed documents has been presented in several cases.
In the Oklahoma case, after State Farm finally turned over to the court a “claims legal research” DVD and other records, Judge Richard G. Van Dyck told company attorneys
“As I was watching these tapes I just want to say this for the record, the hair on the back of my neck did — did stand up because I was seeing things there that early on in this case I was told by (State Farm) defense counsel didn’t exist and couldn’t be produced. So I’m not real happy with that and I want to remind all counsel that their ethical responsibilities as attorneys outweigh the wishes of their clients.”
Gary T. Fye, an expert in the analysis of disputed insurance claims who lives in Nevada, often testifies in insurance cases. Fye, who said he has testified on behalf of policyholders and insurance companies, has provided the courts information on State Farm’s history of destroying and withholding records.
In 1998, Fye wrote in a Florida case
“I have been witnessing document destruction, concealment, and obstruction of discovery by State Farm for many years in connection with my review of internal claim practices documents of the insurer. I have accumulated certain Exhibits which show the company’s goals and objectives for document handling by its employees. The documents show close to 28 years of intentional destruction, concealment and distortion of claim practices records.”
In some cases, company executives did not keep records.
Jeff Marr, the attorney suing State Farm in Oklahoma, took sworn testimony Sept. 6 from Rust. Topics included Rust’s Chairman’s Council, made up of top State Farm executives. The group, which includes the company’s general counsel, meets quarterly.
Marr was fishing for records of those meetings that he could subpoena for his lawsuit.
“Certainly,” Marr asked Rust, “you keep records of the quarterly meetings where the entire Chairman’s Council is present?”
“We have an agenda,” Rust said, “but minutes in that, no.”
“Why not?” Marr asked.
Rust replied, “Never felt a need to.”
Marr later asked, “Are there any written agendas that are available should I choose to request them in the lawsuit?”
“I’m not sure what might be available,” Rust said.
Rust also said policyholders, who essentially own the private mutual company, are not entitled to know what the Chairman’s Council discusses or decides about litigation against State Farm, citing attorney-client privilege.
Marr questioned why the company would withhold information from policyholders, who own State Farm.
“Well, again,” said Rust (who has a law degree), “I’m not an expert in the area, but I think as you find — even if I’m a shareholder in a publicly traded company, there are things that are not — you know, I do not have access to.”
Marr later asked if policyholders have a right to see documents from State Farm’s investigation of Haag.
In the Oklahoma case, after State Farm finally turned over to the court a “claims legal research” DVD and other records, Judge Richard G. Van Dyck told company attorneys
“As I was watching these tapes I just want to say this for the record, the hair on the back of my neck did — did stand up because I was seeing things there that early on in this case I was told by (State Farm) defense counsel didn’t exist and couldn’t be produced. So I’m not real happy with that and I want to remind all counsel that their ethical responsibilities as attorneys outweigh the wishes of their clients.”
AIG has burned through a lot of the credit the taxpayers extended them, in just a few short weeks. But we have only heard about vague deal notes have been released on their plan to get captial out of their
$1 trillion dollar company. As we all heard, this was a stop gap to give them time to liquidate valuable assets to meet their continuing financial obligations. But if they are burning at this rate, they will never recover, unless they stop the bleeding (today!)! The longer and deeper they go in using of gov’t short term bridge loan, the less chance of any resonable payback. Also, when they run through this first amount, will we continue to lend them more? The gov’t must get AIG moving to get their house in order ASAP, then to pay back that money. If AIG ultimately goes out of business, we the people will be out of that cash they borrowed forever!!!!
The Government made a loan and is a shareholder. They hired the CEO, and are in control of everything the company does. The Democrats love class warfare but have no solutions. Just complain and blame. This is political grand standing by Mr Waxman. So Mr Waxman wants to know where the loan money went, well maybe they spent the money on prostitutes from a New York escort company, Uppps that was Spitzer. My bad.
boy, looks like there are 535 guys wanting to run AIG – the full house and senate all want to call the shots?
AIG won’t have a chance of turning around if they’ve got that many bosses – – – –
Actually, AIG has over 300 million owners. Every current and future US taxpayer has an interest in a company of questionable worth with an impaired ability to raise capital. As one of these new owners, I want to know how the money is spent as I do not want this to become a moneypit.
Have you tried to sell anything lately in this market? Things don’t sell overnight. Would you just “give away” an asset, I think not. You would want to get the value of your investment.
But the complainers want results and they want them NOW! Let’s see, too many cooks spoil the insurance company. What other cliches can we come up with? We all know how well government runs their business.
I dont work for the company but do own stock in AIG. Bought 10,000 shares at $.69. It is funny how someone can be outraged at a party provided to agents who earned their way to a California resort. If you want to be outraged be so with congress for giving the money and Barney Frank and Chris Dodd who did nothing to oversee Fannie Mae and Freddie Mac. This is the epicenter of the mortgage meltdown. AIG just bought the bad loans through derivatives. Historically very safe investments, provided people underwrite the loans and Congress provides oversight to Fannie and Freddie. Blame them not AIG. Oh by the way my investment looks ok. up 80% in 2 weeks and thanks to our new socialist government I dont need to worry about the company going broke The US will be there to protect their investment. lol.
I wish they would just set up a bidding process and sell it all off .It will all be gone anyway under this so called leadership if it does not get sold off soon. Lord knows we have more than enough capacity in the market place right now.
AIG= All
Investments
Gone
Ed Liddy, the new AIG CEO is a decent, honorable man. His experience in breaking up the Sears Financial Network and solid performance at the helm of Allstate will make a positive difference at AIG. Listen to what he is saying and consider that when they are done restructering, and paying their unprecedented taxpayer financed loan by breaking up much of AIG it will still be a $40 billion a year insurance giant. It may be the time to consider buying a few shares of that stock.
LET’S SEE—-MANAGEMENT OR MISMANAGEMENT? DO YOU THINK CONGRESS INVESTS PRUDENTLY? IS WAXMAN PART OF CONGRESS? DOES WAXMAN HAVE TO ANSWER QUESTIONS ABOUT HIS PART OF CONGRESSIONAL “INVESTMENTS”, SUCH AS VOTING HIMSELF A SALARY INCREASE, AND HAVING A GOLDEN HEALTH INSURANCE PLAN? MAYBE WE ONLY NEED ABOUT 10% OF THE FEDERAL GOVERNMENT EMPLOYEES? THINK OF THE SAVINGS!
Now that some comatose politician has awakened and realized he and his cronies have boned the public, they need to look like they’re doing something. Sounds vaguely familiare like “it’s too late to close the barn doors after the horses have left.” NOW they want to know how it’s being spent? Wouldn’t you think they’d want an accounting up front BEFORE they gave them the money? People in this country should be VERY AFRAID because we have no leaders. After decades of “experience” this is what we get from our elected officials? So much for the argument you need “experience” in the political system. I suggest the opposite. Experience is a narcotic. We need a change, and not just paving the existing cowpath. Vote carefully on 11/4.
I am a conservative by nature, but certain industries must be regulated and held accountable to the letter of the law and prosecuted for speeding. Banking, Insurance, Stock Brokerage, (WAll Street in general). These industries have for the last hundred years or so caused crises after crises when deregulated. Banking dates back to the Andrew Jackson Era when he told them by god in heaven he would see them regulated as they were vipers and theves.( Check your history) Each time there has been deregulation of these industries there has been a bad recession, or depression that followed in a short period of time. We need to reinact the McCarren Ferguson Act or its equivilent that restricts these industries to just there own business and then restricts what they can do without oversite. Thats my view anyway and I have been in the insurance industry for just over 44 years.
While historically Freddie and Fannie have been aligned with Democrats, since 2004 they have been very much aligned with Republicans. The head of Freddie Mac, if I remember correctly from an article I recently read, worked for the George H.W. Bush administration prior to going to Freddie Mac. And since 2004, they have spent more lobbying Republicans to support their cause and donating to Republican candidates more than Democrats.
The problem is lobbyist, as these people provide the necessary ingredient for the policital system. It is beyond a Democrat or Republican problem. The government had to spend $700 billion just to keep the credit markets functioning in a dysfunctional fashion. The sad news is that the $700 billion is just the initial installment as this little problem will cost tens of trillions more, as the whole system of credit is broken.
Please vote Nov 4. Regardless of who is elected, this mess will result in higher taxes, increased inflation, and a lower standard of living for all.
Nice post, Bill. Don’t blame those poor innocent victims at AIG. It’s the government’s fault. Here I was thinking it was a bunch of thieving scumbags at AIG but you sure cleared that up. Thanks.
Hey Henry, how’s about we ask how Barney Frank and his ex and Christopher Dodd spent taxpayer money? You have some nerve. I have my opinion on AIG, but PLEASE Henry, don’t act like you give a rat’s bum about us taxpayers. Too little, too late.
“Washington, Oct 9 – When will Chairman Waxman schedule a hearing on Fannie Mae and Freddie Mac and call Franklin Raines to testify? House Democrats continue to refuse to examine the two government-sponsored institutions that started the mortgage meltdown in the first place – Fannie Mae and Freddie Mac – and they refuse thus far to call on former Fannie Mae boss Franklin Raines to testify about his role in the economic crisis. In a story entitled “What about Fannie and Freddie?” the Christian Science Monitor notes the “conspicuous absence” of any hearings on the two Democrat-friendly institutions and highlights the efforts of House Republicans to force a closer look at how Fannie Mae and Freddie Mac led to this economic crisis: “
I realize that selling AIG assets won’t be easy, but they need to move on these NOW. Even at a deep discount, this should be a priority to get the tax money out of the mix. If they don’t reorganize, get back to being a non-govt. insurance company, it won’t really matter. They are burning a heavy cash load by the second, and like it or not, unless the tax dollars are first in and first out, the tax payers will never see anything back. Once my tax investment in AIG are divested, I don’t care what happens to them. A company who gets a cash call and is basically out of biz in just two weeks didn’t and doesn’t deserve (anymore) help!
So Rubee, how do you know about this “secret”? You’re an arse.
You stupid democrats think we’re deaf, dumb and blind. Do I need to post the dozen or so articles I can easily find, or do I need to send you the youtube film of Maxine Waters, Christopher Dodd, and others, saying they were picking on Raines so he could be allowed to continue *****ing the taxpayers?
I would like to see them put in jail for this. People seem to separate their hard working money going to taxes from what the “government” spends.
I cannot help but think about that great movie line from Mars Attacks, when President Jack Nicolson says “two out of three ain’t bad” after Martians vaporize the entire congress. If only…
I don’t think the Democrates are the ones who don’t get it!!! First you asked for deregulation ( A Republican Platform) Then you screw up the system and steal everything that is not nailed down. If Joe the plumber or andy the Dairyman goes under you don’t give a d—. But when the big boys butt gets in the ringer they ask for a handout and a bailout… I am pretty sure that sounds like soliciam for the wealthy…But then just what the h— do I know anyway. I have owned my own business for over 44 years and will gross over 1.3 million this year… And you say that I am a dumb Democrat and don’t understand. It is the Higherarchy of the Republican party who don’t get it….We are tired of being screwed over..It is time for a major change IE: Strict Regulation of Banking, Wall Street, Insurance and anyone else who controls the markets. In the last eight years we have seen more theft by conversion than at any other time in history and yet Republicans are conservative…Give me a break.
INTERESTED PARTY: I AGREE THEY NEED TO BE REGULATED, BUT WHEN JIMMY CARTER STARTED THE WHOLE HIGH-RISK LOAN SCHEME IN 1977, I BELIEVE HE WAS A DEMOCRAT. AND ISN’T BARNEY FIFE,I MEAN FRANKS, A DEMOCRAT? BUSH HAS MADE SOME MISTAKES—THEY ALL DO—BUT HE WAS IGNORED 2-3 YEARS AGO WHEN HE TOLD BARNEY TO WATCH ‘EM, BUT BARNEY TOLD HIM TO BUG OFF!
Larry:I used to be a Republican…for a lot of years..I am 67. Now I may be best described as an independent who will vote Democratic this year. Since you brought up Jimmy Carter…I believe he was elected with a minority of democrates in congress and was restricted in some ways but as I recall he was trying to get us out of another mess…Lets see Bill Clinton had eight years ( I was not a fan) also had a minority for part of his term and couldn’t get much done….Other than that I don’t seem to remember many Democrats in the Presidents office or that they had a majority for much of these years. Looking at the Republicans….They have not only been the primary party in power, but have had the majority in both the house and senate much more than the other party….Somehow a lot of people feel that the Democrats are the only ones to blame…I don”t think so. There is enough to go arround to all congress..whatever party. Lets vote em all out and send in a new team…..Of course another issue is the electorial college…We have not had an election decided by popular vote in years…Not sure but that sounds and smells like more gerremandering politics to me….Is it a true Democracy when the popular vote does not decide who wins?
THANK YOU FOR YOUR THOUGHTFUL RESPONSE. I THINK A DEMOCRAT TENDS TO TRUST THE GOVERNMENT MORE, AND A REPUBLICAN DOESN’T. I AM A REPUBLICAN CUZ I THINK WE HAVE WAY TOO MUCH GOVERNMENT. I WOULD LIKE TO SEE TERM LIMITS FOR EVERYONE, NOT JUST THE PRESIDENT. IT WOULD BE A WAY TO MINIMIZE THE GRAFT AND CORRUPTION, REGARDLESS OF PARTY. I ALSO THINK WE NEED VERY SEVERE LIMITS ON WHAT A CANDIDATE CAN SPEND ON HIS OR HER CAMPAIGN CUZ THEY WANT TO GET IT BACK!
They have chosen to look for ways to save on claims.
The 60 million U.S. homeowners who pay more than $50 billion a year in insurance premiums are often disappointed when they discover insurers won’t pay the full cost of rebuilding their damaged or destroyed homes. Property insurers systematically deny and reduce their policyholders’ claims, according to court records in California, Florida, Illinois, Mississippi, New Hampshire and Tennessee. The insurance companies routinely refuse to pay market prices for homes and replacement contents, they use computer programs to cut payouts, they change policy coverage with no clear explanation, they ignore or alter engineering reports
January 7, 2008, 9:57 am CST
Posted By: Henry
Comment:
RE: twists Say the Heck with Discipline; Vow to Cut Rates to Gain Market Share This would be back to the future–they did it in the 80s! Insurance CEOs Say
1) Not us “the people” agreed to make the loan, so we didn’t have that much to say in the first place. Basically we finance whatever the gov wants us to do. If you have a problem w/it don’t blame AIG but your congressman.
2) Its a loan and the gov basically owns most of AIG, if needed the gov can take over and sell their assets.
3) It’s a loan, not an entitlement thinking we are running the company. How would you feel if your mortgage company came knocking on the door every time you decided to do something to your house? Or does anyone here give explanation to their bank or credit card company on how you spend their money?
AIG will not fail. They are a big strong insurance company. When they clean out the mess made by the financial services division they will be just fine. The Gov just loaned them 126 Billon and we are worried about $400,000 in agent earned recreation. Get a life. People sell and are rewarded for doing so. I have no problem except with Henry Waxman who will not miss a chance to go after a big business. What a joke!!!
Mad as HECK you might want to check from (TRUTH OUT) Freddie Mac, secretly paid a REPUBLICAN FIRM to kill legislation $2 MILLION , the firm name is DCI, even after Sen. Chuck Hagel put up leislation
You missed the point of the post. Corporations will act inapropriate, carelessly risky, corupt and posibly illegal. The way the world works is these companies do not survive and go bankrupt. Well we just converted from the free market economy to socialism. Now these companies are rewarded and get as many chances as they want to get it right.They can be as risky as they want, without consequence. What is to stop the 9 banks who were forced to take 25 billion each with no restrictions on what they can do with it. I heard the CEO of Bank of America say they plan to buy up smaller banks with the money, I would be upset if I were a competitor of BOA. Thats why I bought AIG, They now cannot lose, Just win. My point is, Thats not right. Oh well, I will just invest where ever the Government says they will not let the company go under and buy a blue chip stock at a penny stock price.
WRITE YOUR CONGRESSMAN/SENATOR. WE DEMAND A PUBLIC HEARING ON THE FAILED OVERSIGHT OF FANNIE AND FREDDIE.
TO THE UNTOUCHABLES. Edward B. Rust, Jr., will be happy to tell you that he is the Chief Executive Officer of State Farm Mutual Insurance Company. He has deep family ties to State Farm, as his father and grand father have both served in that capacity. He will also tell you that he is an educated man who has been to law school and is a past practicing attorney. In addition, he was the chairman of the Coalition for Excellence in Education and a member of George W. Bush’s transition advisory team on education. So with all of that education why will he not deal with his company’s inbred greed. Does he not know that we are in the 21st century where anyone can look on the internet and see the billions of dollars that are being spent to protect their empire from the consumer? In Utah, the company was fine $25 million in punitive damages, in part for the “systematic destruction of documents and systematic manipulation of individual claim files to conceal claim mishandling”. An Idaho appeals court fined the company $9.5 million in punitive damages for making use of “a completely bogus” outside bill review company that helped lower the cost of medical bills. In October of 1999, an Illinois jury rendered a $456 million judgment against State Farm and an additional $730 million in punitive damages for the insurer’s breach of contract with auto policy holders by relying on generic replacement parts. Rust was adamant in his insistence that fraud had not been committed. A class action law suit in the name of State Farm policy holders was filed in 2003 for breach of contract and statutory consumer fraud in which $1.1 billion was awarded to plaintiffs. When a company is misleading the public, should that not be considered fraud? A consumer would go to prison for that type of behavior. State Farm will let you know that, in several states, fraud and abuse is pushing up the cost of auto insurance. A court in late 2001 reached an unfriendly consumer decision that could have the effect of reaching deep into the pockets of the consumer. Sharply higher jury awards in vehicular liability cases are putting additional upward pressure on auto insurance rates. The average jury award in auto liability cases rose from $187,000 to $269,000 in 2000, an increase of 44%. I question if any of the lawsuits would be necessary if the company would just fairly pay their claims. The company represents on their web-site that consumer protection is one of their most important goals, but do they really think that courts would be awarding multiple millions of dollars in bad faith claims if that were their emphasis? State Farm’s ratings are based on their financial strength. State Farm states that their high ratings are also based on strong claims paying ability. With this ability, why is it necessary for their policy holders to allege that the claims department was directed, in evaluating their cases, to take them to trial instead of settling within the limits of the policy? This practice exposed policyholders to judgments above the limits of their policies, when the company was attempting to make an effort to win smaller decisions. Two former in-house attorneys for State Farm contend that they were often called upon by the insurer to represent its’ policy holders and were forced to commit “unlawful and unethical activities, including requiring the two to stay silent about the rights of the policyholders”. State Farm seems to have reckless indifference for the truth for the purpose of corporate and personal economic gain. State Farm should know that continued scrutiny of their claims paying practices will continue especially with the advent of new claims that are surfacing from lawsuits revolving around Hurricane Katrina. A message to Mr. Rust, and any employee of the company that is acting in bad faith for its policy holders. Its time to stop no more. Each time there has been deregulation of these industries who wins ???
WRITE YOUR CONGRESSMAN/SENATOR. WE DEMAND A PUBLIC HEARING ON THE FAILED OVERSIGHT STATE FARM.
God has said nothing about regulation. If you like regulation, God should send you here in Florida. Our Governor has run off all the good carriers writing homeowners and the State is the largest carrier. There is no private market rated by Best rating offering to write homeowners. Thats what excessive regulation will get you. By the way State Farm is one of the finest Personal lines carriers in the country. Thats why they are the largest and sued the most. They are dealing with an aggressive legal environments and pricing preasure to either look for ways to save on claims or raise their rates. They have chosen to look for ways to save on claims.
By Anita Lee
McClatchy Newspapers
Advertisement
BILOXI, Miss. (MCT) — In some cases, State Farm’s top leadership prefers not to share or even keep records that offer insight into how policyholder claims are handled, according to court records.
Chairman and CEO Edward B. Rust Jr. said in sworn testimony earlier this month that no minutes are kept of quarterly meetings held by the company’s top management, the Chairman’s Council, and that policyholders have no right to information about an investigation State Farm Insurance Cos. has ordered of its relationship with Haag Engineering Co.
State Farm spokesman Phil Supple said the company doesn’t “intend to-;try this-;case in the media.”
“State Farm stands by testimony given by President and Vice Chairman Vince Trosino, who said when asked about these allegations, ‘It’s not part of our system. It’s not part of our core values. It’s not what made us the most successful property and casualty insurer, life insurer, in the country.'”
Juries in two states, Texas and Oklahoma, have found Haag provided biased reports to State Farm to minimize or deny policyholder claims. Mississippi’s attorney general currently is conducting a grand jury investigation to determine whether State Farm and other insurers denied Hurricane Katrina claims through the use of fraudulent engineering reports.
Haag denies bias, but State Farm suspended business with the company in June and ordered an independent investigation after an Oklahoma jury awarded a total of $13 million to a policyholder over tornado damages. Subsequent trials are set to determine damages for 70 other policyholders, all of whom had claims investigated by Haag.
In past court cases, judges have chastised and even fined State Farm for withholding records the company was ordered to produce. Evidence the company destroyed documents has been presented in several cases.
In the Oklahoma case, after State Farm finally turned over to the court a “claims legal research” DVD and other records, Judge Richard G. Van Dyck told company attorneys
“As I was watching these tapes I just want to say this for the record, the hair on the back of my neck did — did stand up because I was seeing things there that early on in this case I was told by (State Farm) defense counsel didn’t exist and couldn’t be produced. So I’m not real happy with that and I want to remind all counsel that their ethical responsibilities as attorneys outweigh the wishes of their clients.”
Gary T. Fye, an expert in the analysis of disputed insurance claims who lives in Nevada, often testifies in insurance cases. Fye, who said he has testified on behalf of policyholders and insurance companies, has provided the courts information on State Farm’s history of destroying and withholding records.
In 1998, Fye wrote in a Florida case
“I have been witnessing document destruction, concealment, and obstruction of discovery by State Farm for many years in connection with my review of internal claim practices documents of the insurer. I have accumulated certain Exhibits which show the company’s goals and objectives for document handling by its employees. The documents show close to 28 years of intentional destruction, concealment and distortion of claim practices records.”
In some cases, company executives did not keep records.
Jeff Marr, the attorney suing State Farm in Oklahoma, took sworn testimony Sept. 6 from Rust. Topics included Rust’s Chairman’s Council, made up of top State Farm executives. The group, which includes the company’s general counsel, meets quarterly.
Marr was fishing for records of those meetings that he could subpoena for his lawsuit.
“Certainly,” Marr asked Rust, “you keep records of the quarterly meetings where the entire Chairman’s Council is present?”
“We have an agenda,” Rust said, “but minutes in that, no.”
“Why not?” Marr asked.
Rust replied, “Never felt a need to.”
Marr later asked, “Are there any written agendas that are available should I choose to request them in the lawsuit?”
“I’m not sure what might be available,” Rust said.
Rust also said policyholders, who essentially own the private mutual company, are not entitled to know what the Chairman’s Council discusses or decides about litigation against State Farm, citing attorney-client privilege.
Marr questioned why the company would withhold information from policyholders, who own State Farm.
“Well, again,” said Rust (who has a law degree), “I’m not an expert in the area, but I think as you find — even if I’m a shareholder in a publicly traded company, there are things that are not — you know, I do not have access to.”
Marr later asked if policyholders have a right to see documents from State Farm’s investigation of Haag.
“No,” Rust said.
“Why not?” Marr asked. “Is it privileged?”
Rust said, “I believe so.”
(c) 2006, The Sun Herald (Biloxi, Miss.).
In the Oklahoma case, after State Farm finally turned over to the court a “claims legal research” DVD and other records, Judge Richard G. Van Dyck told company attorneys
“As I was watching these tapes I just want to say this for the record, the hair on the back of my neck did — did stand up because I was seeing things there that early on in this case I was told by (State Farm) defense counsel didn’t exist and couldn’t be produced. So I’m not real happy with that and I want to remind all counsel that their ethical responsibilities as attorneys outweigh the wishes of their clients.”
AIG has burned through a lot of the credit the taxpayers extended them, in just a few short weeks. But we have only heard about vague deal notes have been released on their plan to get captial out of their
$1 trillion dollar company. As we all heard, this was a stop gap to give them time to liquidate valuable assets to meet their continuing financial obligations. But if they are burning at this rate, they will never recover, unless they stop the bleeding (today!)! The longer and deeper they go in using of gov’t short term bridge loan, the less chance of any resonable payback. Also, when they run through this first amount, will we continue to lend them more? The gov’t must get AIG moving to get their house in order ASAP, then to pay back that money. If AIG ultimately goes out of business, we the people will be out of that cash they borrowed forever!!!!
The Government made a loan and is a shareholder. They hired the CEO, and are in control of everything the company does. The Democrats love class warfare but have no solutions. Just complain and blame. This is political grand standing by Mr Waxman. So Mr Waxman wants to know where the loan money went, well maybe they spent the money on prostitutes from a New York escort company, Uppps that was Spitzer. My bad.
Outraged is right. Bill you probably work for AIG.
boy, looks like there are 535 guys wanting to run AIG – the full house and senate all want to call the shots?
AIG won’t have a chance of turning around if they’ve got that many bosses – – – –
Actually, AIG has over 300 million owners. Every current and future US taxpayer has an interest in a company of questionable worth with an impaired ability to raise capital. As one of these new owners, I want to know how the money is spent as I do not want this to become a moneypit.
Have you tried to sell anything lately in this market? Things don’t sell overnight. Would you just “give away” an asset, I think not. You would want to get the value of your investment.
These are HUGE companies to sell, they dont just get a deal done overnight…
But the complainers want results and they want them NOW! Let’s see, too many cooks spoil the insurance company. What other cliches can we come up with? We all know how well government runs their business.
I dont work for the company but do own stock in AIG. Bought 10,000 shares at $.69. It is funny how someone can be outraged at a party provided to agents who earned their way to a California resort. If you want to be outraged be so with congress for giving the money and Barney Frank and Chris Dodd who did nothing to oversee Fannie Mae and Freddie Mac. This is the epicenter of the mortgage meltdown. AIG just bought the bad loans through derivatives. Historically very safe investments, provided people underwrite the loans and Congress provides oversight to Fannie and Freddie. Blame them not AIG. Oh by the way my investment looks ok. up 80% in 2 weeks and thanks to our new socialist government I dont need to worry about the company going broke The US will be there to protect their investment. lol.
I wish they would just set up a bidding process and sell it all off .It will all be gone anyway under this so called leadership if it does not get sold off soon. Lord knows we have more than enough capacity in the market place right now.
AIG= All
Investments
Gone
Ed Liddy, the new AIG CEO is a decent, honorable man. His experience in breaking up the Sears Financial Network and solid performance at the helm of Allstate will make a positive difference at AIG. Listen to what he is saying and consider that when they are done restructering, and paying their unprecedented taxpayer financed loan by breaking up much of AIG it will still be a $40 billion a year insurance giant. It may be the time to consider buying a few shares of that stock.
LET’S SEE—-MANAGEMENT OR MISMANAGEMENT? DO YOU THINK CONGRESS INVESTS PRUDENTLY? IS WAXMAN PART OF CONGRESS? DOES WAXMAN HAVE TO ANSWER QUESTIONS ABOUT HIS PART OF CONGRESSIONAL “INVESTMENTS”, SUCH AS VOTING HIMSELF A SALARY INCREASE, AND HAVING A GOLDEN HEALTH INSURANCE PLAN? MAYBE WE ONLY NEED ABOUT 10% OF THE FEDERAL GOVERNMENT EMPLOYEES? THINK OF THE SAVINGS!
Now that some comatose politician has awakened and realized he and his cronies have boned the public, they need to look like they’re doing something. Sounds vaguely familiare like “it’s too late to close the barn doors after the horses have left.” NOW they want to know how it’s being spent? Wouldn’t you think they’d want an accounting up front BEFORE they gave them the money? People in this country should be VERY AFRAID because we have no leaders. After decades of “experience” this is what we get from our elected officials? So much for the argument you need “experience” in the political system. I suggest the opposite. Experience is a narcotic. We need a change, and not just paving the existing cowpath. Vote carefully on 11/4.
I am a conservative by nature, but certain industries must be regulated and held accountable to the letter of the law and prosecuted for speeding. Banking, Insurance, Stock Brokerage, (WAll Street in general). These industries have for the last hundred years or so caused crises after crises when deregulated. Banking dates back to the Andrew Jackson Era when he told them by god in heaven he would see them regulated as they were vipers and theves.( Check your history) Each time there has been deregulation of these industries there has been a bad recession, or depression that followed in a short period of time. We need to reinact the McCarren Ferguson Act or its equivilent that restricts these industries to just there own business and then restricts what they can do without oversite. Thats my view anyway and I have been in the insurance industry for just over 44 years.
No worse than AIG did.
While historically Freddie and Fannie have been aligned with Democrats, since 2004 they have been very much aligned with Republicans. The head of Freddie Mac, if I remember correctly from an article I recently read, worked for the George H.W. Bush administration prior to going to Freddie Mac. And since 2004, they have spent more lobbying Republicans to support their cause and donating to Republican candidates more than Democrats.
The problem is lobbyist, as these people provide the necessary ingredient for the policital system. It is beyond a Democrat or Republican problem. The government had to spend $700 billion just to keep the credit markets functioning in a dysfunctional fashion. The sad news is that the $700 billion is just the initial installment as this little problem will cost tens of trillions more, as the whole system of credit is broken.
Please vote Nov 4. Regardless of who is elected, this mess will result in higher taxes, increased inflation, and a lower standard of living for all.
Nice post, Bill. Don’t blame those poor innocent victims at AIG. It’s the government’s fault. Here I was thinking it was a bunch of thieving scumbags at AIG but you sure cleared that up. Thanks.
Hey Henry, how’s about we ask how Barney Frank and his ex and Christopher Dodd spent taxpayer money? You have some nerve. I have my opinion on AIG, but PLEASE Henry, don’t act like you give a rat’s bum about us taxpayers. Too little, too late.
“Washington, Oct 9 – When will Chairman Waxman schedule a hearing on Fannie Mae and Freddie Mac and call Franklin Raines to testify? House Democrats continue to refuse to examine the two government-sponsored institutions that started the mortgage meltdown in the first place – Fannie Mae and Freddie Mac – and they refuse thus far to call on former Fannie Mae boss Franklin Raines to testify about his role in the economic crisis. In a story entitled “What about Fannie and Freddie?” the Christian Science Monitor notes the “conspicuous absence” of any hearings on the two Democrat-friendly institutions and highlights the efforts of House Republicans to force a closer look at how Fannie Mae and Freddie Mac led to this economic crisis: “
I realize that selling AIG assets won’t be easy, but they need to move on these NOW. Even at a deep discount, this should be a priority to get the tax money out of the mix. If they don’t reorganize, get back to being a non-govt. insurance company, it won’t really matter. They are burning a heavy cash load by the second, and like it or not, unless the tax dollars are first in and first out, the tax payers will never see anything back. Once my tax investment in AIG are divested, I don’t care what happens to them. A company who gets a cash call and is basically out of biz in just two weeks didn’t and doesn’t deserve (anymore) help!
So Rubee, how do you know about this “secret”? You’re an arse.
You stupid democrats think we’re deaf, dumb and blind. Do I need to post the dozen or so articles I can easily find, or do I need to send you the youtube film of Maxine Waters, Christopher Dodd, and others, saying they were picking on Raines so he could be allowed to continue *****ing the taxpayers?
I would like to see them put in jail for this. People seem to separate their hard working money going to taxes from what the “government” spends.
I cannot help but think about that great movie line from Mars Attacks, when President Jack Nicolson says “two out of three ain’t bad” after Martians vaporize the entire congress. If only…
Democrats at their best supporting Fannie Mae. Wow!
http://www.youtube.com/watch?v=usvG-s_Ssb0
Cut and paste and go to Youtube to see this one.
I don’t think the Democrates are the ones who don’t get it!!! First you asked for deregulation ( A Republican Platform) Then you screw up the system and steal everything that is not nailed down. If Joe the plumber or andy the Dairyman goes under you don’t give a d—. But when the big boys butt gets in the ringer they ask for a handout and a bailout… I am pretty sure that sounds like soliciam for the wealthy…But then just what the h— do I know anyway. I have owned my own business for over 44 years and will gross over 1.3 million this year… And you say that I am a dumb Democrat and don’t understand. It is the Higherarchy of the Republican party who don’t get it….We are tired of being screwed over..It is time for a major change IE: Strict Regulation of Banking, Wall Street, Insurance and anyone else who controls the markets. In the last eight years we have seen more theft by conversion than at any other time in history and yet Republicans are conservative…Give me a break.
INTERESTED PARTY: I AGREE THEY NEED TO BE REGULATED, BUT WHEN JIMMY CARTER STARTED THE WHOLE HIGH-RISK LOAN SCHEME IN 1977, I BELIEVE HE WAS A DEMOCRAT. AND ISN’T BARNEY FIFE,I MEAN FRANKS, A DEMOCRAT? BUSH HAS MADE SOME MISTAKES—THEY ALL DO—BUT HE WAS IGNORED 2-3 YEARS AGO WHEN HE TOLD BARNEY TO WATCH ‘EM, BUT BARNEY TOLD HIM TO BUG OFF!
Great article just sent to me:
http://www.ldsmag.com/ideas/081017light.html
Larry:I used to be a Republican…for a lot of years..I am 67. Now I may be best described as an independent who will vote Democratic this year. Since you brought up Jimmy Carter…I believe he was elected with a minority of democrates in congress and was restricted in some ways but as I recall he was trying to get us out of another mess…Lets see Bill Clinton had eight years ( I was not a fan) also had a minority for part of his term and couldn’t get much done….Other than that I don’t seem to remember many Democrats in the Presidents office or that they had a majority for much of these years. Looking at the Republicans….They have not only been the primary party in power, but have had the majority in both the house and senate much more than the other party….Somehow a lot of people feel that the Democrats are the only ones to blame…I don”t think so. There is enough to go arround to all congress..whatever party. Lets vote em all out and send in a new team…..Of course another issue is the electorial college…We have not had an election decided by popular vote in years…Not sure but that sounds and smells like more gerremandering politics to me….Is it a true Democracy when the popular vote does not decide who wins?
THANK YOU FOR YOUR THOUGHTFUL RESPONSE. I THINK A DEMOCRAT TENDS TO TRUST THE GOVERNMENT MORE, AND A REPUBLICAN DOESN’T. I AM A REPUBLICAN CUZ I THINK WE HAVE WAY TOO MUCH GOVERNMENT. I WOULD LIKE TO SEE TERM LIMITS FOR EVERYONE, NOT JUST THE PRESIDENT. IT WOULD BE A WAY TO MINIMIZE THE GRAFT AND CORRUPTION, REGARDLESS OF PARTY. I ALSO THINK WE NEED VERY SEVERE LIMITS ON WHAT A CANDIDATE CAN SPEND ON HIS OR HER CAMPAIGN CUZ THEY WANT TO GET IT BACK!
They have chosen to look for ways to save on claims.
The 60 million U.S. homeowners who pay more than $50 billion a year in insurance premiums are often disappointed when they discover insurers won’t pay the full cost of rebuilding their damaged or destroyed homes. Property insurers systematically deny and reduce their policyholders’ claims, according to court records in California, Florida, Illinois, Mississippi, New Hampshire and Tennessee. The insurance companies routinely refuse to pay market prices for homes and replacement contents, they use computer programs to cut payouts, they change policy coverage with no clear explanation, they ignore or alter engineering reports
January 7, 2008, 9:57 am CST
Posted By: Henry
Comment:
RE: twists Say the Heck with Discipline; Vow to Cut Rates to Gain Market Share This would be back to the future–they did it in the 80s! Insurance CEOs Say
• AIG Buys China: No. China buys AIG
1) Not us “the people” agreed to make the loan, so we didn’t have that much to say in the first place. Basically we finance whatever the gov wants us to do. If you have a problem w/it don’t blame AIG but your congressman.
2) Its a loan and the gov basically owns most of AIG, if needed the gov can take over and sell their assets.
3) It’s a loan, not an entitlement thinking we are running the company. How would you feel if your mortgage company came knocking on the door every time you decided to do something to your house? Or does anyone here give explanation to their bank or credit card company on how you spend their money?
Does anyone know newly elected (“in the press”), president Obama’s stance on affirmative action? hmmm no one will ask the question, why is that?
We know his stance on redistribution of wealth!