Brokette: He is insulting the actuaries in our profession. If he were really that sophisticated, he wouldn’t be working for minimum wage catering to clients who cannot pay their bills or manage their lives. Anyone could work with those clients, but the very best brokers work with clients who have it upstairs. It’s amazing, you have a guy with no actuarial experience pretending he knows more than them.
That the article would cite race as an issue when insurance companies KNOW they’d be burnt at the stake if they even tried to racially profile their insureds. Leave it to Reuters to mention something other than legitimate loss data to characterize what insurers do. I feel the nationalization of our industry around the corner. After all, it’s working so well for banks and automakers.
I have yet to be shown stats that support the industry position that low credit scores equate to higher auto or homeowner claims. I suppose the Government is concerned about a lack of hard evidence as well.
During this time of financial crisis, with the credit card companies and banks running credit scores into the ground as a means of justifying the increasing interest rates on those “higher risk” accounts, the insurance industry needs to back away from skewed data.
Ah, I just realized…skewed data. That has been and continues to be the basis of underwriting and rate making decisions for all lines of coverage.
Think about where the elimination of ‘redlining’ back in the 70s got us to today! Subprime; Short Sale; Foreclosure; bank failures! Better keep using those credit scores!!
American Family has a well-established history of documented racism in its practices. Here we go again. Credit scoring has been a BOON to companies looking to avoid insuring other-than-white people. Hope they don’t survive THIS review.
It’s amazing that NOW the FTC is concerned about credit score rating-where have they been for the last few years. This isn’t exactly a new issue. Agents, Brokers and Insureds alike have not been able to figure out how the credit based rating works and have been frustrated by the process. It appears to be another sign that we have gotten away from the fundamentals-underwrite the risk properly and more often than not your bottom line will be fine. Isn’t that how the top carriers got that way in the first place? So, where did all the underwriters go anyway-are they endangered….It sure does look that way. This should be a giant wakeup call, if we as an industry can’t properly regulate ourselves and stick to what we do best, someone else will do it for us. We just have to look back to the early 1940’s; McCarrin-Ferguson Act paved the way for the FTC to do its thing now. Someone once said, “we who forget our history are doomed to repeat it.” It should be one hell of a show.
There have been numerous studies done on the link between low credit scores and higher loss ratios. This strong correlation has been proven even in university studies. The question remains however if the low credit scores fall unevenly among certain races? If there are more blacks or latinos with poor credit scores is this a backdoor approach to unfairly discriminating among certain ethic groups? If so, should we ban the use of credit in underwriting? I firmly believe insurance companies are NOT trying to discriminate based on race. These carriers simply want to charge a more appropriate premium to those with lower credit scores.
Where have you been? The statistics have been available for everyone to see for many years.
So some feel the people that live responsible must have their premiums increased to reduce the irresponsible’s. Since the 1960’s declared War on Poverty this government transferred trillions of dollars to the irresponsible and what did it get us? No thanks are heard from the irresponsible, only a demand for more.
Come Jan 20th, I will declare that all minorities and middle class people do not have to pay for insurance anymore. They can get it for free. We will just start charging the rich people more for their insurance. How else can I keep my power base unless they are completely dependent on me. Yes, my version of modern day slavery.
Are you kidding me? If you can’t find the evidence then you haven’t been looking. Google search:
1. Epic Report
2. Texas Credit Study – TDI
3. Texas Study – Bureau of Business Research
4. Maryland Insurance Administration study on credit
5. FTC study on credit scoring for automobile insurance
Reasonable people could disgree that the factors that lead to a correlation between credit score and loss history may be redundant to other sources, or that use of scoring results in a disparate impact on certain classes, but it is simply ignorant to argue either that the correlation doesn’t exist or that scoring is used for ethnic purposes (insurers don’t collect racial information and have no idea the applicants background).
Anyone in the industry that has not looked at the statistical significance of credit scoring and not agreeded that it should be part of the underwriting equation is extemely lazy or uninformed. The industry will not have any problem with the investigation at all. The public does not like the fact that certain minority groups seem to have higher rates because of this statistical fact, but all those carriers will survive this just fine. THe up side is perhaps it will bring to our public another lesson similar to the mortgage crisis, save and live within your means.
Your post is illogical. Charging racism is a worn out statement and an excuse for someones failure. The insurance companies and their agents are in this business to make money. Why in the world would we care what color someones skin is? I would recommend you grow up.
Amen to Pat and Ned… I’m glad that someone “GETS IT”!! Like was said earlier, this is not a new topic. Just like what happened before, the insurors will be fine. This is not unfair or racially motivated(that is so tiresome). Everyone has a choice of how to spend their money and affect their credit. If you have issue with that, it’s not with your insurance carrier. Look in the mirror.
I understand the concept, yet, after 10+ years I am not convinced that most of my clients with low scores have any worse of better claims experience. It causes them to seek insurance in much more expensive markets, such as FAIR Plan or E&S Lines, which is a financial burden, harder to place and makes our industry look bad. What happens when the loss of jobs due to layoffs from the irresponsible finacial giants starts to affect credit scores of the once otherwise credit worthy elite? If insurance companies did credit scores on their own rank and file (worker bees) who work paycheck to paycheck, maybe they would be a little kinder and less cold calculating. Credit scoring has been the success for marketers of the various services, and the insurance companies, like pigs in a the herd simply follow one another in this stupid practice. Merry Christmas to all !!!!
Under his wealth allocation plan all the people with the good credit can pay a good credit tax. Then we take the good credit tax and give it to the people with the bad credit. Then everybody gets equal rates. Hope and Change is coming in less than a month to all.
I am sorry if I sound racist. That is quite funny considering my lineage. You are correct, insurance is about protecting assests by spreading risk and making $ in a manner that is built on statistical analysis and science. The industry has its bad eggs (like every business/profession) but the majority of us in it are not racist or un professional.
Why bother to quote studies and facts? John Q and others don’t care about facts, just how awful the practice is to some named group. My company has numbers outside any study that back up the insurance scoring we use. That’s why the various insurance departments have accepted our methdology. But again, why bother when posters like John Q don’t care about facts, just their own feelings. Perhaps a change in industry to one you could feel good about would be in order.
In Texas if Whitey has poop credit he gets poop rate. The numbers prove that credit rating works. If Obama has good credit he will get A#1 Whitey rate. What’s the problem? Black, Brown, Dot Coms with good credit all get same as A#1 Whitey rate. If you let your cars go back and have been kicked out of a couple of sub prime loan houses your loss potential is proven higher.
FYI – I don’t know an insurance company who doesn’t check employees credit (pre-hire). I knew several of the hiring managers and still had my credit, criminal record, education and emplyment histories checked. There is a connection between how you manage your money and how responsible you are – even at work.
Also, just so you know, as the bankruptcies have increased of late so have our fire losses. Who knows if it’s arson or depending on candles for light, but the loss experience has suddenly and dramitically increased in hard hit areas.
Folks, On January 20, 2009, when we become the United Socialists of America, it won’t matter. Our Congress will appoint an insurance czar to promulgate rates, being sure to apportion some to the federal coffers and create a new bureaucracy.
Remember Winston Smith
“… Two gin-scented tears trickled down the sides of his nose. But it was all right, everything was all right, the struggle was finished. He had won the victory over himself. He loved Big Brother.”
I hope that all who think we are going the socialist route will decline Social Security and Medicare when they qualify (unemployment too!). I’m sure they wouldn’t want to participate in the redistribution of wealth!
I have been in the insurance industry since long before credit scores. I have a couple of observations:
my small company has proven there is not a correlation betwen credit scores and homeowners claims. however, if you have someone with a low score, they can’t come up with their deductible, they can’t maintain their premises very well, and they let their insurance lapse. lapses are overlooked at one of the significant expenses insurance companies face; a non pay customer is much more expensive to maintain than a good pay customer
and finally, and most importantly, how do you know you are discriminating on the basis of race, when NOBODY has a question on their application as to what race the applicant is??????
I paid into, and still do pay into, Social Security and Medicare and you can bet your sweet bippie, I’ll collect them – unless, of course, I can get one of those lucrative pensions that Congress gets! If “Pro” is the opposite of “CON”, is that why Progress is the opposite of Congress??
If it’s a good credit tax then wouldn’t it be a bad credit credit? You would being taking away from all the bad people with good credit and giving credit to all the good people with the bad credit. Sounds like hope and change be a coming!
So, let me see if I understand this correctly. If my credit score is low, but I have NEVER filed an insurance claim, I have to pay higher rates because I am a higher risk? Call me ignorant, but that doesn’t make any sense at all. I could see it if I had a low credit score with a long claim history, but even then I would think my claim history would be the best indicator of whether or not I would be likely to file a claim.
I would like to see the government prove the industry wrong. So many seperate companies have acquired adequate data to demonstrate the importance of using the scores in pricing that it seems ridiculous to question it.
I think if the government thinks they can do well with their own rating plan they should start their own company. Perhaps focusing on risks with low scores, specific races, no fire protection, pit bull terriers, or any other cockamamie niche they have that they feel we overprice. However, I would say they cannot have an unfair advantage. Specifically, no use of taxpayer funds. They need to find private capital like everyone else, or issue a assessable policy.
Level the playing field and lets see who knows better how to match rates to expected expenses.
I’ve have been in the business on the agency side long before credit scoring (50+). The many companies I represented had proven to me there is a correlation between credit scores and losses.
For all the posts I just read, I was surprised how many were actually in favor of credit scoring and believe in its viability as a valid underwriting tool.
The studies all seem to indicate that there is a strong correlation between credit scores and loss potential.
Now, for those who say “I have a low credit score and I have never had a loss”. Too bad – haven’t you heard of the “law of large numbers”? Just because you have had no losses has absolutely nothing to do with the total statistics supporting the credit rating/underwriting relationship.
Let us hope that the Feds don’t get their hands on the insurance industry. Look at flood insurance rates – there is no doubt that the loss ratios for National Flood would drive a regular insurance company into the ground. Companies need to make profit! The Feds would create rates that wouldn’t cover the losses – and then wonder what happened. The proof is highly visible every day on the stock ticker and the reports of bankruptcies, etc.
You want a government run insurance program look no further than their FLOOD PROGRAM that is 17 billion in debt. A few of these companies that they are reviewing are actually taking up the baton to try and find a way to write flood either by endorsement/policy to figure a way to fix that program. The problem is that the government will want oversite! They ran their progam so poorly, but they want to oversee someone else?
As mentioned, credit has plenty of statitical backing, nobody asks the race, religion etc questions.. Always remember, Insurance IS discriminatory.. is just has to be FAIRLY discriminatory! That is why a 16yr old, single, male driver is more expensive than a 35yr old, married, female driver…
I guess if the insurance company would know in advance you would never have a loss during your lifetime they would develop a special rate for your type. But the fact is that you do not know what your record will be prior to death.
If all insurance policyholders had losses there would be no insurance, as insurance collects premiums from the majority to pay losses of the few.
No matter how you want to argue this, facts will prove that credit scores are an accurate factor in predicting losses.
I agree with scoring, but why not use the actual credit score and not the “insurance score-made up model” by each company which is different for every company. A Score that is good for one company is not so good for another company. Doesn’t make sense to me.
You seem to have missed a couple of points in the story.
1 – The government wants to see particular client loss experience – randomly picked by the government for review. That seems to indicate that, somewhere in the bowels of the bureaucracy, there appears a conscientious analysist who has finally found the climate wherein politically influenced micromanagement of the regulatory process can be ignored — look where special interest legislation has brought us thus far.
2 – The current credit scores are skewed. A majority of Americans do not save and are, on average, carrying $10K-15K in credit card debt. That would suggest that these Americans have, or should have, lower credit scores. Does that mean that they will now drive carelessly or that they will stop maintaining their homes? Well, they may not have the money to properly maintain their homes, but that does not mean a higher morale or moral risk is evidenced for this group.
3 – Please cite the stats you refer to.
Rick, will you please explain how there can be creditable evidence when it takes a careful study of large numbers and a lengthy amount of time to prove the position that lower credit scores equate to higher claims frequency? The industry simply hasn’t been using credit scores for a sufficient amount of time. But, what do I know? That’s why I’m asking you to please enlighten me.
The stats and scores do tend to play against the poor. Oh, wait, that may be the financial position of many in this country. So, then there will be an outcry against credit based rating?
It’s ok to use credit scores to promulgate rates, just as long as it doesn’t affect your rate, eh?
Why is everything about race? This is about finances. I am oppose to credit scoring not for any reason other than it makes those without income pay more for a government mandated coverage (auto).
Everyone get over it! We have a black president now!
Hooray. Maybe finally these insurers will have to explain and demonstrate how their hocus – pocus use of crdit scores has legitimate relativety to people’s driving ability or propensity to cause auto accidents.
The FTC should also investigate the Fair Isaacs company and have them justify the ‘black box’ for their creation of the infamous FICO score. I’m quite sure they will find that their ‘black box’ is based on a myriad of false assumptions or assumptions that are rooted in prejudice.
Given that the use of FICO scores are almost universal in our life, the time is long over do for a true public invesigation of how exaclty this ‘black box’ was constructed. Just as a simple example: today many lenders are unilaterally reducing credit lines. This would then result in a lower FICO score for the borrower because the debt relative to the avaialble credit line has increased. In this instance, the change in ratio had nothing to do with the borrower yet the FICO score goes down. Obviously, this is just one exmple of where the FICO ‘black box’ needs fixing.
good comments on Flood, it is incompetently managed. Moreover, anyone can acquire business when offering inadequate rates backed up with taxpayer subsidies.
I want to see the government prove us wrong, by using their own pricing methods without the backstop of taxpayer funds.
But, to simply state that there are studies galore, without citation, leaves one wondering.
Please don’t be so smug in your superior stance. Not everyone in the industry has time to read these studies. Many on the production side of the business have these new rating models shoved down our throats without explanation or reference to specific studies.
Pat has given me specific studies. I’ll save further comment until I’ve had a chance to do a bit of reading.
Which “real” credit score? Equifax, TransUnion, or Experian?
Also, those scores contain information that insurers are not permitted to use, like actual balances and income.
The insurance scores are arranged so as to get the best predictive value for that insurer. Most smaller companies use an off-the-shelf model anyway. If you get a quote you don’t like, shop around.
I agree with most of your position except that the law of large numbers is supose to include everyone. Reducing the numbers by credit scores hurts those with limited finances and helps those with good finances. I believe it does not spread risk to everyone. It actually works against the laws of large numbers in my opinion. You make good points though.
If you want a summary go to the Insurance Information Institute web site, click on Issues, Credit Scoring and you will see a well-written white paper and several presentations that support the correlation.
And, before you complain that these are biased viewpoints, remember that several of the studies were commissioned specifically to prove that credit was not correlated to loss history and was inherently unfair, yet they concluded just the opposite.
Again, I believe reasonable people could debate redundancy and disparate impact, but not the existence of correlation or willful unfair discrimination.
I’ll attempt to answer your questions in a condensed manner.
#1. Why should the government get involved with its many paper pushing bureaucrats when the market will do the work for them, and more efficient. There are hundreds of companies competiting for business. If one thinks his/her quote/premium is too high then shop around.
#2. Credit scoring has nothing to do with rich or poor. It is about responsible living. Those that manage their finances in a responsible manner also manage life that way. Those that have 10k to 15k credit card balances are living beyond their means, are certainly not managing finaces in a proper way and usually have lower credit scores. You might not realize this but there are many rich people that have low credit scores.
#3. “Please cite the stats you refer to” Why should I? You can eaisly find this information for yourself.
Regarding your last comment. Credit scores began circa 18 years ago in 1990.
Again, credit scores do not play against the poor. It is how one manages his life style. There are both rich and poor with high and low credit scores.
A perfect example of Government helping Government by giving them something to do. If the members of Congress feel there is a void in companies’ credit modeling, why don’t they join forces to start their own private company which should be profitable?
This is Ironic in a sense that hard-working, tax paying citizens are paying Members of Congress and the FTC to figure out how to spend the hard-working, tax paying, honest people’s money to assist the NON-tax paying, unemployed, and dishonest.
Well said George! It really is simple: insurers do not ask your race when quoting so someone thinks that they are replacing low credit scores for race. But there are LOTS of “other-than-colored” people who have low credit scores. If credit scoring is a backdoor approach to applying race to the underwriting and there is an admitted problem where low scores would also apply to whites, then it would seem that using credits scores would skew the data in the other direction; if that were so do you think companies would continue to use credit scores at all?
Don’t blame Obama for your mistakes! You voted for BUSH! Your Republican party voted for SOCIALIZING AIG AND THE AUTO MAKERS. Wake up and think before you write anything against something you don’t know.
One interesting thing to consider. From everything ive read over the years, no one has ever told me what the average insurance score is for a person who makes 20 grand as opposed to a person who makes 100 grand.
Im not saying credit scores cant predict claims, but we should at least be able to determine if poor people have to pay more for insurance because of credit scoring.
People say the credit score is about personal choices and responsibility, but if the average credit score for some one making 100,000 is higher than the person making 20,000, then it goes to show that insurance scoring discriminates against the poor.
And who knows, maybe you think that’s ok, but at this point we don’t have all the facts.
So tell me why throughout all these discussions no one besides me has ever even asked the question: Do people who make more money have better insurance scores? Show me the exact numbers.
I believe poor people often have lower credit scores because instead of choosing to be responsible and buy a Ford instead of a Volvo, or buy a 50 inch plasma instead of a 60 inch, poor people have to make credit decisions that have to do with whether or not their kids get school cloths, or a modest gift for Christmas.
Its harder to be fiscally responsible when you don’t have enough money for the basics. Its just pure and simple logic.
Try balancing a poor mans budget as compared to a rich guy, conceptually, both can have great credit scores, but we all know in the real world it just doesn’t work that way.
As far as race goes, what is the average credit score of a black person as compared to a white? Its a simple little question that could help us get to the bottom of this mess.
But over and over and over, we just don’t ever see the answer mentioned anywhere.
—– Original Message —–
Jack, I doubt if it will happen; there is just too much else to do so that adding the burden of another federal bureaucracy does not loom large on the horizon; the industry will fight back with a campaign to educate the public and public advocates. It comes down to public inertia; it will take a lot of money to get anything new off the ground and as scare as new money is now, old money sure isn’t available. the new administration is up to its ears with other problems. I doubt if Kanjorski has the muscle, let alone the support to get anything up and running within four years….
You might want to check the Congressional voting record before you blame the Republicans, hon. A Republican President with a Democrat Congress is what we have now. Believe me, WE’LL be blaming the Dems here after Jan. 20th because they’ll have control of both houses of Congress and the Presidency. Let’s see you absolve your party then. hahahahahahaha
We already have a proven model, National Flood Insurance. It is surely FAIR, no one can complain about being discrminated against, for whatever reason; and we can also attest to the result: underfunded, underreserved, slow to pay, etc. Imagine how the government “insurance” would work, the first claimants in, get paid until the money runs out and we wait another year for another appropriation or another bail out.
I am in the process of reading the Epic Report; the Texas Credit Study-TDI; the Texas Study – Bureau of Business Research; Maryland Insurance Administration study on credit; and, the FTC study on credit scoring for automobile insurance.
Thanks to Pat Beranger for the citations.
I suppose I would be one who would argue that underwriters should be involved in the review and rating of these issues, but I suppose that would be too costly for the carriers these days.
The pricing of home and auto coverage does not seem to take into account the particular circumstances of a given prospect. Current rating is computer generated and, for the most part, bypasses underwriting. What about the client who has filed for bankruptcy due to catastrophic medical costs? How about the drug dealing insurance carrier VP, or drug snorting attorney/physician/politician that is flush with cash and sports a stellar credit score? Where is the fairness in the rating? This has the appearance of falling dangerously close to a class-based rating scheme. I have clients who only graduated from high school, have minimum wage jobs, and low credit scores, yet they pay their premium on time and have never filed a claim. I have clients who are college educated professionals, seem to understand how to work the system, have high incomes and credit scores, are slow to pay premium, file multiple claims, and then are cancelled because of claim frequency. Which profile is the better risk for the carrier?
I believe you will begin to hear from incensed clients who are being handed increased premium due to wholesale lowering of credit scores by the reporting agencies. Yes, these clients should have managed their financial lives a bit more responsibly, but they are trying to rid themselves of debt and should not be penalized while they are responsibly attempting to turn their financial lives around.
Give us a break and get back to claims-based underwriting and rating.
Why would it make a difference if higher incomes did have higher scores.
The insurance industry is trying to match a price to the expected cost of a risk.
We really don’t give a rats behind about actual personal choices or how difficult they may be for a particular household. We simply want to insure EACH household against insurable loss exposures at a price that is both market competitive and allows the insurer to make a reasonable return on our investment.
Were not the government. We don’t intend to spread wealth, we simply protect what you have.
Let me get this straight, ive got a poor insurance score, so therefore you wont hire me, rent me a place to live, let me get a cell phone, let me get the heat turned on, or let me get insurance?
I have a question for you–Why is the presumption that low income people automatically have bad credit? Is that because you believe everyone is entitled to shop at Neiman’s when they can only afford Target?
Something forgotten in this old rich vs. poor debate seems to be that someone somewhere had to work very hard to earn and acquire that wealth. Further, being rich does not automatically equate to managing money well. There are plenty of “rich” people living beyond their means. Irresponsibility knows no monetary bounds.
Good God, Jake! You make our system sound completely devoid of any opportunity. How the heck does anyone in our society graduate from school, get a job, place to live and insurance? It happens everyday. The sky isn’t falling, Chicken Little.
… in that they always seem to seek their own level. I believe companies were looking for the tool(s) which was(were) best at predicting losses at the best(or more appropriately “competive”) price. It allowed them to let incoming apps “flow through” with little or no underwriter touches, thus reducing costs. I believe that is why you are now seeing a constant tweaking to the models as companies receive and compile their own statistics. It certainly has improved profitabliity and has also kept the premiums lower for most, however it has raised prices on some. For those agaisnt credit scoring (and I was strongly opposed when it first arrived, but have since softened my stance) let me ask this.
1) What about zip codes, are they not more discriminatory?
2) What about sex, is it not sexist to charge a 16 year old male double that of a female?
3) What about age discrimination?
4) What about married vs single?
You people are asking for compassion, but an insurance company is not a charity organization. The only sustainable alternative to charging higher rates to those with lower credit scores is to not sell them insurance at all. Is this the solution you prefer?
I don’t think this is a Rep vs Dem argument..this is Big vs Small Gov. Eventually majority of the population from both sides will say enough is enough.
Oh, no. We prefer the compassion that says, “Take from the dirty nasty rich people who didn’t do a darn thing to earn what they have and give it to the poor people who haven’t earned a thing but they work every day at horrible dead-end jobs and zero choices in life.”
Have I ’bout got that right, Rachel?
Since you are so full of yourself, (you too CHELI) –
Lets make a bet – Ill bet you 1,000, that the average credit score for someone making 100 grand is higher than that of someone making 20 grand.
Would you take that bet? I know there are exceptions to the rule, but would you take that bet?
Even the Salvation Army stops giving if the revenue does not come in.
Insurers must stop insuring if the price is inadequate. So I don’t know if being poor = low insurance score, nor can I care. I must price in a manner that is reasonable.
I SELL INSURANCE. I RUN SCORES ALL DAY EVERY DAY! BELIEVE ME,THERE ARE A LOT OF POOR FOLKS THAT PAY ON TIME EVERY MONTH,AND THERE ARE A LOT OF WEALTHY CLIENTS LATE EVERY MONTH AND THE RICHER THEY ARE,THE MORE LIKELY THEY ARE TO FILE A PETTY CLAIM.
Life is not perfect and neither is credit scoring, however credit scoring is a very good & fair tool in setting price for risk.
You used extreme examples in your argument, “bankruptcy due to catastrophic medical cost” “pill pushing VP etc”. I could retort that the bankruptcy was poor financial management due to not having oneself properly insured; and don’t come back with the response that health insurance was not available as group health is 35% of my agencies revenue & I know its available. Regarding your other example of the drug dealing vp etc etc, those type probably do have lower credit scores as their life style will be reflected in the way they manage finances.
You still seem to be stuck on this high income & low income – rich and poor stuff. CREDIT SCORING IS ABOUT MANAGING ONES LIFE WITH WHAT ONE HAS! Not how much he has or how much he or she makes.
Underwriters are still involved in the process in combination with credit scoring.
If I’m contacted, as you suggest, by incensed clients due to lowering of credit scores, I’m confident I can explain in a way they will understand.
Ah, the old tried and true name calling. I don’t have to bet with you. I’ve been poor and had to manage fewer resources than you’ll ever know. But I got an education and worked my buns off and made something of myself. I don’t know how I did it in a male-dominated profession without a union, but I did. So don’t tell ME the system is unfair and poor people can’t get ahead. And truthfully, credit scoring isn’t the ONLY criteria used for premium calculation. When we start applying social issues to business models, we’ll have huge business failures. It just doesn’t work. I’m sorry about that but business isn’t welfare. Maybe a woman with a little self-confidence isn’t your cup of tea but calling her stupid isn’t the answer.
CHELI, there are those that cannot grasp the concept and those that are too obstinate to admit they got it. This simple concept of credit scoring is one of those that I’m sure they get it, its just that they don’t want to admit it.
Its funny cuz I never said I gave a dam about poor people paying more – Let them starve, I really dont care, just dont lie about it and say they have the same opportunity as the rich guy, cuz thats a not true.
Well, joe, to play devils advocate – if you truly want to match price to risk, I mean, truly match price to risk, not just halfway matching, but completely matching, you would need to have each individual pay for their own losses.
That would be the “fairest” way of all. That would ultimately match the price to the risk. Correct? What? Well, I’m right, right?
Oh yeah …there is a small problem with being that fair. That would cut out the need for insurance – the spreading of risk.
The industry needs to be careful of how far they want to take the “matching price to risk” theory. If it gets to close to the fairest method, they will be out of an industry, and the increasingly socialistic government will step in to save the people.
Abe, I was born dirt poor. I worked my butt off for 50 years and now I’m one of those evil rich guys. I paid my share of double and triple taxation and when I die old Uncle Sam will lop off 50% of what I want to go to my kids to give to your ilk. So I don’t like to read about the poor person that just can’t get ahead because of those rich guys. That’s just an excuse for failure and attitudes like you have will guarantee that failure.
The insurance concept of matching price to risk assumes the price is established before the risk is underwritten. The whole concept of insurance is we are using information to predict the level of risk. Ideally we use the best information available, whether that is credit, fire protection, building code enforcement, etc, etc. We never would want to ignore a very predictive piece of information.
As an agent, you know that very well. We are not in the business of bidding on individual know losses.
I don’t argue with parakeets. I get it, poor people are victims and they never did anything to get themselves in their current situation. And they’ll never dig out no matter how hard they try so don’t even try. Must be comforting to see poor people and believe that THERE’S someone you can feel you’re better than. Keep on believing that tripe.
Next month we are going to get rid of the Republican control in Washington. All new White House, Senate, and House of Representatives. No more Republican control for any of the 3. All Democratic with the leader Obama cracking the whip. Just wait for no more $4.00 gasoline, free health insurance, no more foreclosures, and no more credit scoring.
Have we so soon forgotten the relationship the drug companies have with the FDA?
Are you folks really suggesting to me that these credit scoring studies and the funding for these studies were completely free from industry involvement, and, that the insurance industry has no influence with the FTC?
LOL! By the way, which is your favorite – grape or cherry Kool Aid?
I am certain that the insurance industry did fund some of the studies.
But suppose they are purposely flawed. How would the industry benefit from that? They would be charging low rates to people with high expense levels. And they would be charging high rates to persons with low expense levels. All of the latter group would move to the carriers that did not use credit scoring in their pricing.
Seems illogical, some that the government might do, but not private industry.
Some of you people could not posibly work in the insurance industry. Insurance scores are probably the best predictor of future loss that there has ever been. They have nothing to do with wealth or race. They judge responsibility. I have poor clients of all races with very high insurance scores and wealthy clients with low scores. So some of you are saying that insurance scores are no fair because blacks are inherently inresponsible. How racist is that? If you think that you are racist.
Ins Man – Read the prior posts, you are out of it. Your experience is anecdotal evidence, not fact. They have not given us the information we really need. Would you take the bet that was spoken of?
Poor people probably do have worse scores when viewed as a group – And it can be statistically proven that more black people are in poverty than whites on a per capita rate.
No Statistics are not racist, just people who use unbiased data to paint a whole race of people as irresponsible. I am not going to do your research for you. Look it up yourself. I’ll bet you will not beleive it anyway. Thats the bet I will take.
Insurance scores are the most predictive variable the industry has available. Hands down.
Regardless of whether somebody is able to prove a certain demographic, social or racial group has better or worse scores than another, not using the score takes science out of insurance. It becomes charity and subsidy, not the business of insurance.
Let the government handle charity, subsidy, redistribution of wealth, etc. Let the insruance industry insure people.
I think it is Right and Left VS the far, far, far, far left. “Kool aid consumers” I am a little left of center. Voted for Barack.
I also believe in insurance scoring. I believe in a prudent, statistically sound insurance industry. I don’t believe that the industry shouldn’t be responsible to correct all injustices in the nation. I don’t believe the industry should ignore good indicators.
This discussion could easily be likened to a consumer product with a warranty. A car perhaps. If one model was designed perfectly and never broke down, only a crazy person would expect to pay the same amount for it as for a similar model that was hastily designed and has statistically significant track record of breaking down. Price them differently and the people way out in the cheap seats of left field say that Reliable Car Company is discriminating against “XYZ” group.
if the credit scoring formula were standardized it would resolve a lot of problems. currently carriers pick and choose the criteria they want scored to develope the market they want. i know a major company that will produce a different score for the same insured depending on which agent enters the information. currently the scoring system includes some bias on the part of the carriers. by standardizing how the score is developed everyone including the clients would be on the same playing field. this can be done without federal intervention if the insurance industry would agree on a standard formula in developing everyones score.
Because then they’d be dirty rotten scoundrels for releasing our private information–if only hypothetically. Here’s an idea, become a $100k wage-earner and then you can find out.
There is nothing wrong with a company customizing things to get the business they want, I think the better agencies out there also do their own target marketing.
It’s also time for the government to stop insulting Hispanics and African-Americans as being people who are not capable of being responsible and not being able to achieve top scores, this kind of racism is of the worst kind.
LOL – scientists are known to skew the facts to fit the desired outcome – as some of the posts alluding to scoring services twisting scores into the mold set by carriers to provide preferred rating to a particular segiment of the marketplace.
Science? Please.
This is simply another form of “redlining”. Who do you Kool Aid drinkers think you’re kidding?
1) I have read some of the “studies” and maintain they are junk science. Why ? Real scientific research starts with a random selection of people and follows them for 10, 15, or 20 years gathering all sorts of data. Once the data is collected, it is examined by competent, unbiased experts. THEN the correlations are made because the evidence (facts) yields (will support) the correlations.
2) The “studies” were just that. Someone took 5000 claims and looked for a common thread. That is not “research”.
3) When you do real research, you do not start with a premise and set out to prove or disprove it. It appears to me that all these “studies” started with a premise and took “snapshots” of current data. They then made assumptions and have used data from the snapshots to prove their assumptions.
3) I demand proof that any of these “studies” were conducted as “real research” by asking the following:
a) how many subjects were selected at random ?
b) how long was the data collected? 10 years? 15 years? 20 years?
4) Well, all of you “look at the facts” experts, answer a, b
What are your credetials DarNovak? Typical liberal who dreams things up in your brain and then think it’s reality?
Nevertheless, I will give you a chance to respond.
Also, why do you think you are better than the free enterprise system. If poor credit clients are such great clients, why don’t insurance companies target these people? Why don’t you start you own insurance company? By your logic, you would make a killing. Again, I will wait for your response, don’t be shy.
Warning: I use my real name, not some cutesy sock-puppet name. I am in my 38th year of working in the P&C industry. The following is my opinion and I welcome thoughtful, intelligent discussion.
1) I have read some of the “studies” and maintain they are junk science. Why ? Real scientific research starts with a random selection of people and follows them for 10, 15, or 20 years gathering all sorts of data. Once the data is collected, it is examined by competent, unbiased experts. THEN the correlations are made because the evidence/data yields (and will support) the correlations.
2) In my opinion, the so-called “studies” alluded to in prior posts were nothing but “junk science”. Someone took 5000 (pick a large number)closed claims and looked for a common thread among the policyholders. That is not “research”.
3) When you do real research, you do not start with a premise and set out to prove or disprove it. It appears to me that all of these “studies” started with a premise and took “snapshots” of current data. They then made assumptions and have used data from the snapshots to prove their assumptions. I can do the same thing by looking at a prison population and noting that 80% of the convicted felons prefer mashed potatoes to fries. Therefore, if you prefer mashed to fries, I am going to consider you a likely felon. My study proves it doesn’t it ?
3) I demand proof that any of these “studies” were conducted as “real research” by asking the following:
A. Which of your “studies” selected “X” number of insurance policyholders at random?
B. Which of your “studies” followed their significant random selection and collected accurate, factual (blind) data for “Y” years? In real scientific research like this, the data collectors have no clue as to why they are collecting the data other than it is for research. Many items are collected which are never used in the formulation of the conclusions.
C. Which recognized and accredited professional research entity examined the data and revealed the results of the data which clearly confirm credit score directly or indirectly influences any individual to act in a manner that results in the individual contributing to an occurrence involving liability or property damage that an insurance policy may or may not cover?
Summary: Yes, credit scoring is here and is being used and I must deal with it. I do not accept the studies being touted. Why hasn’t credible “research” been made available to the public in an easy to read and understandable format? Get it out in front of the public and let’s see if we have something real or something imagined. I maintain these “sham” studies would not stand up to professional competent scrutiny.
Regards, Dar Novak AAI
Sock-puppet here. I’m in year 32 of my insurance career and, as such, I am aware of the trashing of years of statistical data collection. We used to utilize all types of information until some social engineer decided it made people “feel bad” to be charged insurance rates based upon their occupation, garaging address/place of residence, et al. Our societal mores change so quickly that we’d never be ABLE to collect 20 years of data to legitimize your theory of research. Further, why do we need 2 decades of research when we have potentially millions of test subjects right now? Insurance isn’t rocket science, sir. I submit that you would never find it fair until your belief system is completely validated by the insurance industry.
I have been in the business for 32 years too Brokette and I feel the same way you do. If this fellow can’t buy the numbers and various studies done tough. The numbers are right and even though we may lose this fight in the long run I still think it’s a completely valid program. By the way, only the ego freaks post their own name from my experience.
When someonei this great country takes a civil service test they get graded on a point curve. Certain groups like disabled veterans get extra points. Why not offer distressed socio economic groups a step up with a government mandated credit bail out proposal. Everyone who ever defaulted on a big screen TV purchase would get 100 extra points on their credit. Auto repos would get 200 points handicap and a home foreclosure would get 300 points. You would only be allowed to get the credits 1 time and only two sets of credits per address. Couples would not have to be married only shacked up any 21 days of the last 365.
Yeah but then a couple could get a joint score of like 1200 if they each lost a big screen, a Lexaus, and a house on the sub prime. If you only need 800 for the good credit then tax the other 400 points and share the wealth.
One problem with credit handicapping would be who decides the points? Example; How many points do you get for letting something go back to Rent-A-Center vs. if you were buying it instead of rent to own. What about breaking an apartment lease. We are going to need a new government committee to do the ratings. You know like a Department of Credit Handicapp Rtaing Bureau.
Credit rating is like all other laws of large numbers. It works overall but is not fair to some. When you discriminate against young male drivers under 21 you will unfairly hurt the few of them who will never cause an accident. However overall it is the best way to date to justify the high cost of these young male drivers overall.
Throughout these posts numerous people want to see the data on a person who makes $20k versus $100k. Hasn’t anyone realized that this is a question that is not used by insurance companies in determining a rate? THAT would be a discriminatory question.. So keep asking for the info and arguing the point..It is info that can’t be reliably produced.
Its the government who is getting ready to ban it – So, they should have access to this information not the insurance companies – The credit bureaus who compile this info and compute your credit score know everything about you and are all regulated by the government.
Just press the right button on your super computer and send the answer to the congressmen.
Then we will know whether or not scoring dicriminated against people who make less money.
Credit scores dont come from insurance companies they come from places like equifax. So if congress wants to ban scoring they can just ask the questions from the credit bureaus, they know everything about you, you dummy!!
Prior to insurance I worked at a credit card company. The information used by scoring companies is only as good as the data provided on a credit app. Same as an insurance application. Often this information is not provided, even tho it is asked for.
Also, the post that have been out there have been aimed at insurance companies providing this information to prove the statitical data going into rate.. How do you figure that the government is now going to provide this info? Before schooling me maybe you should pull your head out and understand what you are asking for.. Again having these vague notions of super computers doing eveything by pushing a button.. next you’ll tell me you still believe in Santa..
So staffman you dont think that the credit agencies know how much money people make per year?
And you are wrong, no one said the insurance companies should provide this info, how would they know how much you make?
Maybe someone suggested that the insurance industry should sponsor a study.
Once again, once the government gets involved you have access to all the info you need.
You are an idiot if you dont read the posts more carefully and if you think that congress cant get info for a study on how much people make as opposed to their insurance score – its pretty simple.
Keep name callin’ if it makes you feel like a big man..
Working in staff for one of the nine companies, the FTC has been in contact with with everyone for 2-3 months prior to their formal request for information. Knowing what they are inquiring about give me an insught to where they are heading on their quest. I will not elaborate, but most of these posts don’t seem to be on the mark.
I am taking your advise, which obviously you are not, and signing off this post because it has degraded to name calling.. Now go back to your CSR job before the principle of the agency catches you…
Actually, one of the more common problems I read about credit scores is that they DON’T take income into account. They count $X of debt the same whether a person makes $20,000 or $100,000. If the credit agencies had this information, wouldn’t it make sense to use it?
I find it more painful to sit in silence and bear the judgements of people who know nothing about me. People who can do no better than name-calling don’t impress me. Thanks for the analysis, boys!
First, there are two different things being discussed. Credit scores are generated by the various credit agencies. They are flawed, and because the system is still very “black-box”, it is difficult for the individual to get their hands on and effectively correct. But, it’s gotten better in recent years, and hopefully, the system will continue to improve. Especially now that more than making a credit purchase is being determined with it’s use – ie: electric rates, apartment rentals, even the ability to open a bank account. Not being able to buy an expensive automobile is entirely different from being told that you can’t live in a nice apt complex, and must move to the next crime-ridden zip code. But, all of that is an entirely different issue.
Which brings me to point number two. An insurance score is different from a credit score. This article pertains to insurance scores – and, in particular to their appropriate or inappropriate use for Homeowners Insurance. I think it’s fairly reasonable to conclude that the validity to auto insurance has been shown. Peoples habits and attitudes directly contribute to their overall ability/skill, or lack thereof, in operating a motor vehicle. Whether this transfers as reasonably to Homeowners, I believe can still be argued. For the most part, people’s credit will not determine whether they are hit by a tornadoe, earthquake or sweeping fire. Upkeep on the home can possibly effect the degree of damage caused by these occurances, but only in a very small way (in my opinion).
Sure, there is the moral hazard, but that’s always been underwritten for the likely suspects – the folks with absolutely horrible credit histories. By and large, the average consumer that just pays his bills a little late, and runs his credit cards on the high end of the limits will NOT be burning their house down. They are not criminals – just a little less responsible. Yes, their roofs might not be changed as often. But, for the most part, those are going to be changed by insurance companies anyway. It might postpone an individual home, but when you look at the large numbers, roofs are being replaced every X number of years.
Here is something I know for fact in my own agency. I have Home underwriters that credit score and those that do not. My loss ratios are nearly identical in both groups. We obviously sell more policies to good credit risks in the credit-scoring companies, and worse credit risks in the no scoring companies. So, you would think those ratios would be higher in the non-scoring companies. Yes, they charge a little more, but it’s not that much different. My gut says there is a little difference between the two groups, but I’m not sure the difference is worth the cost of running all the scores and constantly programming all the computers – not to mention the obvious public distaste for the practice which leads to negative advertising.
I have NOT read all of these studies recently, but I know in it’s infancy, I paid much closer attention, and I don’t recall any that were related to Homes, only autos. If that’s true, then an investigation on the efficacy in Home Insurance is not unreasonable.
In conclusion, though, the arguements that by pushing a button, the government can determine if the practice discriminates against poor, minority, or religious class, is simply not true because the insurance companies are not using (for the most part) a FICO score. They are custom ordering desired traits that are only portions of the ingredients that lead to a credit score. So, because folks with a FICO score of 650 fall into a given group does not mean their insurance score would …and vice-versa.
It’s all an extremely complicated subject. Not because the ingredients are complicated, but because access to the ingredients of an individuals history are NOT going to be known unless the three credit bureaus opened up their files completely and ChoicePoint revealed all of the various matrices that go into the resulting “insurance score”. That’s not going to happen ever, in my opinion.
I hope you didn’t misunderstand. I think you’ve done a fantastic job of stating the facts and defending yourself. I’m not beating up on you at all.
It’s difficult to have the best discussion in this kind of forum. Our own prejudices and manner of reading the posts will skew the spirit of many posts.
But, that doesn’t make this any less fun on occasion.
Thanks for the clarification. I don’t take anything personally since, I suspect, no one in this forum knows me personally. I just long for “good ol’ days” when we could have a rousing (or an arousing) discussion and still be friends. I fear we’ve lost that but hope springs eternal. Have a wonderful holiday!!
Apparently you completely misunderstand those of us who see Social Security for what it is and, therefore, feel rather cheated. You bet I will gladly collect my pittance in my golden years IF there is anything left. However, there is no way it can be considered contradictory to my thoughts on Social Security since I and my employer will have paid a huge sum of money into the system out of my wages.
If I have personally invested this same huge sum of money, I would likely have a few million dollars to MY NAME that I would do with what I please including pass on to children. I will take this option every day, all day over the option of having my money confiscated by the government, sqandered by said government and then distributed as they see fit including the possibility of telling me there is nothing left.
Everyone is entitled to their opinion, please, but you might want to think through your “position” before making such an inane post.
FYI – An Insurance based credit score and your FICO are two very different things! Some characteristics are the same but some are also different, for example claims history, payment history, etc. If you visit Choice Point’s website you will be able to see the MANY different characteristics that insurance companies ask choice point to use for them specifically.
Give me a break, Hitler! This is called profiling. I thought we were Americans. Is there any discrimination in the Veteran’s Cemetaries? Any time you have thoughts like this you are degrading the lives of young men and women that have died for this country—Black, yellow, red or brown.
Our nation will be restored when it works for the citizens and not for the corporations. How long did it take Congress to raise the minimum wage? You know that it will take that long if any of these ethnic groups has a loss and needs the insurance companies help. Give us all a break! You are dealing with Americans.
Think of it this way, when a child first gets their Driver’s License they are usually 16 and have never driven. So technically they have a clean driving record yet they as everyone knows they are the highest risk (aside from DUI offenders) to an insurance company. So one will pay more for someone with a completely clean driving record but is statistically proven that they are can potentiall cost the insurance company the most.
Similar concept with someone with a low insurance based credit score. Higher liklihood of missing payment, having a policy cancelled due to non-payment, and sadly higher risk of attepmting to commit insurance fraud, file frivelous claims. The insurance rate is based on the potential risk you present.
If I miss a payment, my policy is cancelled (provided certain mandated notice requirements are met) – thus I am no longer a risk for the carrier (and the carrier is under no requirement to reinstate my coverage).
If I am such a bad risk, my driving record should show that, not based on the credit score but something much more tangible – real experience.
Let’s look at it this way, who is a better risk to the insurance carrier: 1) a driver with a perfect credit score but multiple moving violations; 2) a driver with a low credit score but a perfect driving record? They are equal in credit-score monger’s eyes – but which one has shown the truest potential for costing the carrier money?
If the driver with a perfect credit score is a bad driver, he’s still a bad risk; period.
Credit scores say NOTHING of a person’s ability to drive or obey the rules of the road. There is no causal nexus between stupid money management and bad driving; it’s like saying all people of a certain race are bad drivers – it just doesn’t hold water.
And, if it’s true that there is a correlation, the insurance carrier is double dipping. They get the higher rates for poor driving history PLUS the cost associated with a bad credit rating.
A lot of the arguments would be silenced if the carriers would show exactly how much of an effect on the ultimate premium a bad credit rating has. If it’s anything more than a minor (less than 2%) difference, it should be abolished. My fear is it is a major factor.
You people in here posting about the Insurance Based Credit score have to understand that this rating is not specific to determining whether someone will have an accident, it’s a factor but includes more.
It affects things like making your payments on time, letting your policy lapse due to non-payment, and how you take care of your property. These things can lead to claims and more damage to the proprty than less if not taken care of properly so ultimately costs the insurance company more.
Fess up; what part do you play in credit scoring to hold on to it so dearly with only hearsay evidence. An actuary would back it with hard data; although I doubt there is any truly provable hard data that is reliable.
Since our economy is doing poorly right now, won’t more people’s credit begin to suffer? According to the big 3 car companies this is the case. They say they can’t sell cars ’cause about 40% of the car shopers have been unable to qualify for credit in the last couple of months – this according to NPR news reports. That being the case, we now have far more poor drving risks according to your postulation. What happened, did they forget how to drive when the economy tanked?
Also, we teach poor money management in the US. Just one example is pre-approved credit card offers to students while still in college (guaranteeing problems immediately upon graduation).
Sorry, but I can make data say just about anything when I’m after more money.
InsisMyPassion, you make some good points and yes data can be presented in different ways to substantiate different conclusions. However, if the credit data isn’t credible or doesn’t “help” to predict future losses, then why are insurance companies so willing to spend so much money to order credit reports, integrate credit into their underwriting, and defend it’s use with state legislatures & insurance departments. Seems like a waste if it really doesn’t work.
I didn’t say they dont cancel for non-pay I said not every company cancels if you miss a payment, there is a difference.
I don’t need to tell you which ones, I work for one but I don’t feel the need to advertise it on here to you or anyone else because its irrelevant to the discussion.
Look, stop being so narrow sighted these scores are not used just for Auto insurance.
There is more to it then just saying oh just because I have a low credit score doesn’t mean I’m going to have an accident.
It may mean though that you have trouble making your payments on a vehicle you are financing and instead of letting the the vehicle get repo’d for example because you get behind on payments you drop it off out in the desert and set it on fire and claim it was stolen which happens all the time…If you don’t have problems making your payments you are less likely to something like that.
That’s just one small example, so these score are indicators of more than just future auto accidents, it can be related to filing claims in general.
When there’s a disaster, the companies homeowners count on to protect them from financial ruin routinely pay less than what policies promise. Insurers often pay 30-60 percent of the cost of rebuilding a damaged home–even when carriers assure homeowners they’re fully covered, thousands of complaints with state insurance departments and civil court cases show.
Paying out less to victims of catastrophes has helped produce record profits. In the past 12 years, insurance company net income has soared–even in the wake of Hurricane Katrina, the worst natural disaster in U.S. history. Property- casualty insurers, which cover damage to homes and cars, reported their highest- ever profit of $73 billion last year, up 49 percent from $49 billion in 2005, according to Highline Data LLC, a Cambridge, Massachusetts-based firm that compiles insurance industry data.
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.
Did I say anything about race??? Hmm… maybe I did in invisible ink that only you can read. I was just giving you facts with absolutely no opinion of my own placed in there. I can’t believe that a group of individuals who are supposed to be insurance professionals know so very little about insurance and the way that insurance credit scores work. I am however finding this blog very amusing – a lot of us here in the office are astounded at the maturity level (or lack there of) of most of you. Keep it up though – it gives us all a good laugh on a Saturday when the phones are slower!
study found African-Americans and Hispanics tended to have lower insurance scores than whites and Asians and, because of this, tended to pay more for auto insurance.
Hmm… perhaps I should put this as simply as possible for you all – I have read the article – my comments had nothing to do with the race portion of the article AT ALL my comments were directed at the multiple comments I have read in here from people confused by the difference in a FICO and an insurance score. Really people, this is getting out of hand.
You are probably very right peon – I am just amazed by this whole thing. I think that as insurance professionals we should realize that we are always trained to look at the big picture. Stop focusing on the ONE sentence regarding race in the article and pay more attention to what they are trying to say. Also maybe keep in mind that the person that wrote the article may not have a full scope of what this means and what is going on. Jumping to conclusions and making crazy blanket statements like we are not american because we believe in charging the appropriate rate for the risk people present. FYI – if someone has really good credit but a poor driving history – their insurance score will probably account for that therefore they will be paying what they should. It is all about rate subsidization – it’s not fair for the entire membership to have to pay for other people and their risks. What I am saying HAS NOTHING TO DO WITH RACE. I do not care what the article says – this has nothing to do with that. I would highly encourage everyone to educate themselves prior to forming an opinion – that way we are all doing what’s best for our clients everywhere. I really hope that you will take my advice and visit the choice point website. What insurance companies do is pay choice point to run insurance scores on their members and each insurance company chooses the characteristics that are most important to them that decide what the insurance score will be. For that reason my insurance score at company A could be different from my score at company B. It’s not about insurance companies being bullies. It’s about insurance companies protecting ALL their members and ensuring that everyone is paying their fair price. AGAIN THIS HAS NOTHING TO DO WITH RACE. If anyone comments on this post saying something about race then you really need to work on your reading skills. By the way – this is not something that is brand new – it has been used for a VERY long time for many many companies – it is VERY likely that all of you who are also consumers have an insurance score with the company you are with right now. It doesn’t matter if you are white, asian, african american, hispanic – we all have an insurance score based on the risk WE present and we should all be paying the appropriate amount for it. Call your own agent since clearly you cannot figure it out on your own. And please – stop being so immature – we should all be adults and name calling and badgering is extremely rude. We should be using this website as a tool to gain more knowledge about our industry to do our job better. Face it – no one knows everything – we should be here to help each other learn – not bring each other down.
There are quite a few people who post here who just don’t like insurance companies. Melanie is a real hater. I haven’t seen a post from her in a while, but to her we are all cheats and liars. I don’t know what she does for a living, but I doubt she has any actual knowledge of how insurance works. I won’t comment more on this one beyond that this is a procedure that works and has been proven to work. Simple and yet way beyond the comprehension of the anti-insurance scoring posters.
PS – I was reading through some blogs and thought I should add – the insurance companies do not hide insurance scores – they are easily available depeding on what resource each company uses. This is why I keep pushing that you visit the choice point website because that is where consumers can go to find out their score based off of the insurance company they use and of course as long as that company uses choice point. For multiple reasons and legalities – it is not the responsiblility of the insurance company directly to provide consumers with their score – it IS our responsiblity to provide them with a means of finding this score out and finding what characteristics are coming into play when determining their individual score. I cannot speak for other companies as far as this goes, I can only assume it is the same, but where I work – we provide the consumer with everything they need to be able to access their score. We educate them about why this score is used and to be honest I find that after I explain it is not based off of their FICO and what it is based of off they become very understanding.
Just thought I would add that piece of info – I noticed some were under the assumption that we hide insurance scores from consumers. It’s illegal to hide that info and therefore we are more than happy to direct them through the right avenues of getting all the information they are entitled to.
Edward B. Rust, Jr.:
Poverty of the Soul
Do you remember when your heart reflected the very best? Confidence led upright. You believed in honor, and then your life changed forever.
Greed became the poverty of your soul, robbing yourself of happiness. Lying, pretending to be kind, your success. Trickery, injustice, your reward, robbing yourself.
Credit scoring for insurance will not succeed for our indusrty any better than it did for the financial industry. Poor credit history has a higher frequency, than those with better credit. The problem, it should not be used as a primary factor.Conversely, what if we used MVR’s to for auto loans. So if you have 2 citations and perfect credit you pay more than one with perfect credit and no citations. That has the same indicator value, as we know people with poor credit gets more citations. My point is very simple unrelated indicators should not be used (valid or not) to price your product. Look at the credit card company’s, they are overcharging those of lesser credit, and undercharging those who can afford a higher rates. In closing, we need to insure ALL at a fair and profitable rate………
less responsible. Company management is interested in cutting expenses the easiest way possible. The same management that makes the decision to offshore also makes the decision to reduce oversight
Comment:LOOK IT UP. http://www.clarionledger.com/assets/pdf/D069388410.PDF
We should be using this website as a tool to gain more knowledge about our industry to do our job better. Pay more attention to what they are trying to say. Reading skills.
I DID NOT PULL THIS STORY OUT OF THE AIR. ITS THERE FOR ALL OF US after hurricanes Katrina I READ ALL ABOUT THIS GREAT BIG GIANT’S HISTORY. PEOLPE LOST LOVED ONES AND THEIR HOMES AND THIS GIANT SAYS THAT WE DONT CARE! WE ARE BIGGER THAN THE WORLD. WE CAN MAKE LAWS WORK FOR US BECAUSE WE HAVE MORE ATTORNIES THAN ANYONE IN THE WORLD SO NO ONE CAN COME UP AGAINST THE BIGGEST MUTUAL INSURANCE COMPANY IN THE WORLD
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 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 .
So if I tell you that my raison d’etre is cheating poor people THAT will make you happy? I don’t have TIME to focus on cheating poor people. I’m too busy trying to put a roof over my head AND pay the usury taxes California thinks are so essential to life–mostly illegal immigrant life. Stop deluding yourselves. EVERYONE faces obstacles in life. Some overcome them and become successful in spite of them. Others whine and look for someone else to solve their problems, Guess who’s rich?
Insurer anti trust exemptions will be repealed some day. They hey days of the wind fall profits are comming to am end.
When congress has hearings over the big bail outs it will all come out in the wash. The industry will be come more regulated then ever. And of course less profitable. Fat will be cut out and insurers will be forced to follow the laws that the rest of us do.
First the insurance based score is NOT a primary factor in determining premiums, it is simply, A factor of many.
In your example you say lets say we use MVR for auto loan, this is not a bad idea and here is why. If I’m a lean holder, and you have a poor driving history there is a higher liklihood of you getting into an accident, therefore the leinholder is in fact at greater risk, they want to protect their vehicle while it is still being financed.
If a vehicle has been in an accident and even if your insurance company repairs it, it can still depreciate the value of the vehicle therefore if the leinholder does at some point have to repo the vehicle they now have to take an even greater loss.
It definately shouldn’t be a primary factor but it should be A factor. Problem with our country today people don’t want to take ownership and responsibility for themselves anymore.
Pay more attention
Comment:
Comment:LOOK IT UP. http://www.clarionledger.com/assets/pdf/D069388410.PDF
We should be using this website as a tool to gain more knowledge about our industry to do our job better. Pay more attention to what they are trying to say. Reading skills.”obstacles in life.”Brokette just read and think about other people who have no roof have no home at all.
This article is a perfect example of why people need to be more selective of who they choose to insure with.
People are so focused on saving that extra few bucks a month they don’t consider the big picture. That article is not representative of all insurance companies there are good ones and bad ones and unfortunately the and obviously the bad ones give the entire industry a negative appearance.
However there are great stories about times when people are down and the insurance company comes in and saves the day as it were also.
I suggest that those of you actually in the insurance industry ignore this posting and move on. The majority of posters on this line seem to have an insurance company hating agenda and won’t hear anything regarding fact. As I said elsewhere, it’s like trying to argue with children. It may be paranoia, but I think some people are paid to post on this site and others to spread disinformation on insurance companies. Who knows why, but there is too much consistency of cutting and pasting of a lot of these nut case posts to be different people. Your are wasting your time arguing with these people who can never be convinced that insurance people aren’t the devils themselves.
A federal judge in New Orleans has dismissed an antitrust lawsuit Louisiana’s former attorney general filed against some of the nation’s largest insurance companies after hurricanes Katrina and Rita. “Crooks” !!!! 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. [ MR nobody important]
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
This problem is NOT whether credit scoring is an accurate predictor of losses. The problem is that income IS reflected in credit scores in spite of Equifax and Experian’s claims to the contrary. Credit scores measure the % of available credit a person uses. The higher the usage %, the lower the score. And, the amount of credit available to any person is directly related to that person’s income. So, a person on the lower end of the income scale is going to have a very low credit limit available and a person on the high end will have a high credit limit. If both people use their credit card to buy tires, for example, the lower-income person will use a significant portion of their credit limit than the higher income person, resulting in a lower credit score for the lower-income person. In addition, lower income people are more likely than higher income people to use their credit cards. Higher income people can pay cash for their tires. Lower income people need to pay on installments. In short…the system is skewed in favor of higher wage earners….whites and asians. It’s not discrimination against a RACE, it’s discrimination against the poor. The poorer you are, the more you have to pay. Lower credit scores mean higher insurance costs AND higher interest rates for homes and cars, etc….. Meanwwhile, the credit reporting companies rake in billions of dollars selling information that is often inaccurate and for which they have NO responsibilty to verify before they sell it. If it’s wrong, the person affected by the erroneous reports will spend YEARS trying to clear their records…meanwhile paying more for everything because of a low credit score. It’s the people who sell credit information that need to be investigated and made to cease & desist. If they are going to sell information, they should be required to make sure it is fair and accurate BEFORE the publish it.
AIG received $150 billion in loans from the government to help it remain in business.
In addition, lower income people are more likely than higher income people to use their credit cards. Higher income people can received $150 billion in loans from the government to help it remain in business.
However I personally see nothing wrong with that you said. The poor, or lower income earning segment of the population is more likely to default on loans and submit frivolous claims or commit insurance fraud.
So the ratings are such that the companies can protect themselves by charging higher interest rates and allowing those to have lower credit limits.
Its simple math, if Im a creditor why would I allow a poor person to have a credit card with a $20,000 limit when I know IF they maxed that credit card out they would be less likely to pay it back. I subsequantly charge a higher interest to ensure they are LESS likely to use it, and use it for emergencies (Which technically is what CC’s SHOULD be used for) than for daily spending. Its a system in place to somewhat help people to spend their money efficiantly and correclty and not to over extend themselves.
That’s the way Home Loans USED to be until the Liberal side Governmant got involved and forced lenders to offer loans to people that really ouldn’t afford them so they could buy the nice big house and live the American dream of, “Everyone in America is entitled to own a home” which is NOT the reality.
Now because the Govt at the time decide to regulate and force lenders to offer rediculous loans to these people that couldn’t afford them they start foreclosing when interest rates go up and then the economy as a whole takes a dive because now the banks are losing so much money.
It all falls back on Americans that DONT want to be responsible themselves and their own decisions, who try to live outside their own means, and when things go wrong they blame the govt and the banks.
DONT want to be responsible themselves and their own decisions, who try to live outside their own means, and when things go wrong they blame the govt and the banks.
LIKE AIG GRAY!
I think it would be an interesting study to perform IQ tests on drivers at different levels of insurance rating scores.
Take a representative sample from each score level (below average, average and above average) and have them complete IQ tests.
What do you think the the results will look like? Will they follow the insurance scores?
Everyone post back, I’d like your opinion. Not making judgments or accusations here, just thought it might be an interesting study. And don’t give me the argument of cultural bias as that is the same argument against insurance/credit scores. Just wondering if there is a correlation.
have them complete IQ tests.
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
I scored in at 138 (not so low that I had to beat up the nerds to keep my self-respect and not so high as to cause me to miss out on high school’s best life lesson – teen sex). I had a business deal go bad (actually resulting from a marketing decision made by a regional manager for an insurance carrier regional manager – another story for when I really want to rag on company-side execs), which cause a bit of financial stress on my end and a lowering of my credit score. Can you guess how that affected my insurance premium, hmmm?
A better question, I believe, would be how many of the high credit score, insurance carrier minions use cell phones when they drive? How many of the insurance carrier underwriters, sales managers, and CEOs drink coffee/coke/beer, apply makeup, eat the BigMac/fries or, better still, text while they drive? Idiots and hypocrites! Oh, right…I was suppose to wait for another rant on another day to post my feelings about company-side morons. Ahhhh, there I go again.
I just ask because that whole second pragraph is irrelevant.
Anyway, unfortunately in a free market you really have to be careful about who you do business with taking all potential risks into consideration.
Such as if the person you are dealing with makes a bad decision it could affect your credit score, amongst other things. That is still your responsibility. So I “hope”, you aren’t trying to put all the blame on that regional manager person you described, right?
My point, and please forgive my lacking a proper education, which might have allowed me to make my point a bit more succinct and easier to understand (back to that teen sex comment and not paying attention in school), was that sometimes life happens and you are caught with your proverbial pants down. The action of the regional manager was, in fact, bordering on criminal, but let’s say that I should have felt the gun stuck up my bum before he pulled the trigger, and, as such, it was completely my fault. The extreme loss of income, the financial stress, and the resulting lowering of my credit score did not make me a higher risk the insurance carrier writing my auto insurance.
So, for all those years prior to credit scoring (a product/idea pushed by the credit collection agencies), you company-side Kool Aid drinkers are saying that the auto and homeowners insurance industry was not able to make an underwriting profit based on driving records/type of auto/type and age of construction/loss experience/policy histories?
It’s not that credit scoring isn’t a correct predictor of loss some of the time; it’s that it is simply the wrong estimator of risk to be using in this day and time. Far too many folks who are moral, upstanding clients are being undeservedly penalized because of an arbitrary, credit scoring formula.
Credit scores are further damaged by the current banking practice of raising credit card interest rates, in spite of timeliness of payment, which lead to greater financial stress and slower pay accounts, which result in lower credit scores and even higher interest rates.
There my ADD flaired up and I forgot to answer your question about the second paragraph – so sorry.
Let me see if I can make it a bit plainer for you. The behaviours I mentioned (you know the ones – cell phone usage, drinking/eating/applying makeup and the like), are far more likely to be the cause of claims, and many on the carrier side of the business are guilty of such behaviour. Hence, the comment about idiots and hypocrites. Not sure I can state it more clearly that that.
Somehow, and this may just be the mind of an uneducated lame brain sputtering nonsense, there seems to be a bit of relevance in the statement for the discussion at hand. Ummmm?
But, then what do I know? I’m not an insurance company lackey.
I’m not trying to sound insulting by any means I’m just simply stating that when you go into a business deal with someone you take some responsibility too, now granted there can be situations where you can get totally blindsided, if there was something illegal that happened then and you were not the one comitting a crime then it should have affected your credit.
Ive already stated this before, but again, the insurance based credit score is the the ONLY thing that affects your premium, it is a VERY SMALL part of MANY different sets of criteria that goes into underwriting the risk you present to the company.
MOST of the time, if you have an existing policy in affect and a good standing with the insurance company you are insured with then the credit score won’t even impact you if it decreases while your policy is in affect, and a lot of the companies that use credit scoring just use it the 1st 2 years your policy is in place and no longer consider it after you’ve been with them a while (or after those 2 years).
The only thing I was saying about your second paragraph is that everything you mention can apply TO ANY PERSON DRIVING, ANYONE, those activities you mention are not specific to any one set of people and further, wouln’t matter anyway, UNLESS they get in an accident.
Again, credit scrogin has nothing to do with your driving ability, habit, record..Insurance companies use it to determine the risk you present.
Are you more likely to miss payments, have your policy cancelled due to non-payment, lie about your current situation to get a lower premium, file frivolous claims, or commit insurance fraud, all of which the insurance company has to soak in as losses that have NOTHING to do with driving.
Maybe you should take the time to educate yourself about a subject before you comment on it. You and others posting about how evil insurance scoring is have no knowledge of the actual mechanics of insurance. Try learning a little about something before you try to indict an entire industry for a crime that never happened. By the way, insurance scoring is not a credit score. Insurance scores have other factors taken into account. I know it doesn’t matter to you since you have your paid posting to place, but for someone who isn’t being paid to write this trash it might be a factor.
Even government mandated insurance laws give us the option of finding another financial mechanism to comply with the law. So for all of you insurance haters, I have two words–SELF INSURE.
Try educating yourself in the mechanics of manufacturing and selling ideas and products before you indict the naysayers.
This credit scoring/rating formula is a sham, and, hopefully, soon to be uncovered and revealed as a crime against the American people. You carrier-side lackeys will just take the stand and claim to only be guilty of following orders.
Just a bunch of simple-minded, arrogant accountants driving the industry into a wall! You should be ashamed.
If life is simply an extention of high school, then it’s high time for the bell to announce PE class! Lets line all the accountants and lawyers up against the wall and let the dodge balls fly!
Nobody: I’m for insurance based credit scores. Not against it, I think it’s a good indicator of future potential losses.
Lame Brain: Auto Insurance is statutory in all states. You can CHOOSE to insure through one of the many auto insurance companies, or you can CHOOSE to self insure as well.
FYI, if you choose to self insure I guarentee you it is WAY more expensive. You just need to show proof of financial responsibility to the state.
You do realize the EVERYONE is subject to insurance based credit scores right?
Whether you are in the insurance business or not, my policy is affected by an inusrance based credit score and I don’t have the best credit (it’s not that bad though.) but I’m impacted also. So its NOT hypocritical because those behaviors, and subsequent potential losses, and the credit based scoring is used on EVERYONE.
Tort Reform Group Labels One N.J. County A ‘Judicial Hellhole’
East News • December 19, 2007
Atlantic County, N.J. has earned a dubious ranking: It’s one of six “judicial hellholes” nationwide, according to one tort reform group. “Personal injury lawyers seem to have gained a monopoly …
Back to article
Insurance Journal is not responsible for the content of the message below.
Subject: Read about The real story!!!!!’Judicial Hellhole’
Posted On: December 20, 2007, 8:28 am CST
Posted By:
Comment:
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.
Lame Brain. 29 years in the business and this is your level of knowledge? I have 32 years in the insurance industry. I win. Some people never learn anything about the industry they work in and you appear to be one of those people. You need to get out of the industry if this is your level of knowledge.
Of course there are professional posters. Didn’t the last election teach us that? There are several organizations that are anti insurance company and may well pay posters to cut and past the garbage that’s repeated over and over on these sites and many others. That’s the modern world of the web people, not paranoia.
I agree there are paid posters, but seriously, I think they are actually smarter than the “cut and paste non-relevant material” jerks who are making no sense.
I would expect the insurance companies with the deep pockets to be more likely to employ that tactic anyway.
Insurance companies are only interested in actual activity that will increase writings and profit. Any activity such as this is simply wasted company time on my part. Oops.
Some of the posters are like small children. They see something they don’t understand and say “that’s just stupid”. Take the time to find out how something works before condemning the entire insurance industry to purgatory.
I actually have nothing to say this time around because I feel like I gave pleanty of stone cold facts before and don’t really feel like repeating myself… I just popped in to say WOW – this is getting steamy. It’s starting to make perfect sense to me why consumers resent insurance – because of the sheer amount of IDIOTS working in the industry!
nobody important
Comment:
This is the kind of garbage I think is posted by paid posters. It’s in writing so it must be true?
NO IT,S CALL RECORDS AND TAPES IAM NOT PAID IAM AN ORGANIZER.
I don’t even know what to say – how is it POSSIBLE that there are so many idiots in the insurance world??? Well – nevermind on that one. CLEARLY insurance scoring works – read some studies for crying out loud – that is – if you can even read AT ALL!
Something always seems to be catching fire in this state this time of year, but when the worst California wildfire in over century swept through here a while back, it ignited a storm of controversy. It’s about insurance and whether your home is in California or Carolina, or whether it’s near the wild or in a city, you’ll want learn what happened to homeowners here. The fire four years ago killed 15 people and also destroyed more than 2000 homes. But many residents here had planned for the worst and took some comfort in the insurance policies they purchased, coverage they expected to make them whole again if the worst ever happened.
After the fire, what many got instead was aggravation, and the bitter realization that home replacement insurance plans in many cases didn’t pay to replace homes.
In collaboration with the investigative reporters at Bloomberg markets magazine, we found these controversial practices by insurance companies are widespread in an industry with little federal oversight.
1 conceal claim mishandling. 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 indifferen . 3 jury award in auto liability cases rose from $187,000 to $269,000 in 2000, an increase of 44%. 4. billion,s was awarded . GET THE PONIT.
Federal oversight is not the answer. I can assure you that the State of California provides oversight well in excess of anything the Feds could offer. Further, our State is THE market for personal earthquake insurance that would be completely irrelevant in a place like, say, Kansas.
Just because a person’s fire insurance settlement doesn’t feel enough like welfare to make them happy, doesn’t mean something untoward has happened to them. I can state with relative certainty that most people purchase their personal insurance based solely on its price, not the comprehensive nature of the coverage.
Edward B. Rust, Jr.:
Poverty of the Soul
Do you remember when your heart reflected the very best? Confidence led upright. You believed in honor, and then your life changed forever.
Greed became the poverty of your soul, robbing yourself of happiness. Lying, pretending to be kind, your success. Trickery, injustice, your reward, robbing yourself. 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. Consumer would go to prison for that type of behavior!!
Also, there is no one here that would be influenced by your spam, we already know whats up. [YOU HAVE KNOWN !A HAVE DONE NOTHING ABOUT IT ! BILL THAT MY DEAR FRIEND IS WHY THIS COUNTY IS IN THE HUGH MISS – IT,S -IN . KNOW ONE WANTS TO STEP UP TO THE PLATE WHAT A SICK DIAGNOSE .WAKE UP HAVE A CUP OF COFFEE AND SAY I CAN . IS THAT SO BILL].
I believe that a large amount of the graft and fraud in the insurance industry could be prevented if they would just administer a “morals test” when the insurance exam was administered. The violators today may be few in number, but are HUGE in the damage that they inflict on the American public.
WOW! So I’m sitting here wondering, “Why hasn’t State Farm been the subject of a nationwide mass tort bad faith action?” I can’t believe your brethren in the legal community are letting THAT opportunity pass them by. Further, why is ANYONE buying insurance from State Farm when they are so obviously engaging in deceptive claims practices? Aren’t there ANY other honest insurance companies in this country? Just curious.
THE PLANET
Comment:
WOW! IS THIS WHAT SCRUGGS WAS UP AGAINST? THANK YOU MR SCRUGGS FOR TRYING TO STOP THIS GIANT. THE SAD THING IS THAT YOU ARE BEHIND BARS AND THIS GIANT THINKS IT CAN DO ANY THING IT WANTS AND WE WILL ALL LOOK AWAY. I DID NOT PULL THIS STORY OUT OF THE AIR. ITS THERE FOR ALL OF US after hurricanes Katrina I READ ALL ABOUT THIS GREAT BIG GIANT’S HISTORY. PEOLPE LOST LOVED ONES AND THEIR HOMES AND THIS GIANT SAYS THAT WE DONT CARE! WE ARE BIGGER THAN THE WORLD. WE CAN MAKE LAWS WORK FOR US BECAUSE WE HAVE MORE ATTORNIES THAN ANYONE IN THE WORLD SO NO ONE CAN COME UP AGAINST THE BIGGEST MUTUAL INSURANCE COMPANY IN THE WORLD. WOW! THIS IS LIKE A DOCTOR EVIL MOVIE, OR IS IT JUST THE PLANET OF THE APES?
. 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
Some people questioned my statements that there are professional posters hitting this site. I think this line of postings is a prime example of professional posters. I can’t say I have ever seen such a line of uninformed and illogical garbage posted. The insurance company hating nuts are out in force. How do you try to explain business practices to posters with bats flying around in their heads? Don’t try.
Just so you know, if you dont know how to read and write, or are not indigenous to this country, often times they will ignore your claim or assume its fraudulent.
If your writing is this bad, I can only imagine how you must sound on the phone.
Good point, nobody important. I’m not sure where I came up with the crazy notion, but I was under the distinct impression the article was about credit scoring. Silly me….
Again, please forgive my having checked out the ladies instead of reading through the chapter on sarcasms during high school lit. My failure to maintain proper focus during those valuable sessions has caused me great distress during moments such as this over the years that followed, don’t ya know.
The point I was attempting to make, in that now infamous second paragraph, is that individual behavior and attitude of heart are better predictors of future loss than is an arbitrary credit score, however cleverly formulated and determined.
The very folks who depend upon these scores to “cherry pick” accounts are more than likely guilty of some or all of the careless driving behaviors mentioned in that paragraph. Hence, they are idiots, for eating/drinking/texting/applying makeup while driving, and, hypocrites for pointing accusing fingers at the low credit scoring population as being higher risk deserving higher rates, all the while, ignoring their own careless driving habits. Perhaps the next tactic should be to train agents in reading body language or develop sensory chairs (lie detectors) for prospective clients to sit in while being questioned about cell phone use, eating habits and the like.
By the way, these folks who promulgate the rates are not low paid employees. As a result of being locked into windowless rooms in the sub-basement of their respective Home Offices, they may look pasty and smell like fungus, but they are well paid for their voodoo rituals and mad science. It’s easy to impose an arbitrary standard upon the masses when you are sitting well above that mark.
Actually, no, Lame Brain. Cherry picking in the real world, is called underwriting. Businesses, ones with sense, sell their product to make a profit. Not an evil thing. In our business, you underwrite. Pricing and selection of what coverage to provide and to whom. Why should a company want to write a class of business that will cause them to lose money. No business should do that. I could go on and on like the insurance company hate posters here, but they won’t listen anyway. I hope you go into a business or occupation that can afford to provide your product at a loss every year. If you do, it’s probably government service. I’m done here. The nuts win.
I have been torturing myself for a few days now reading posts about this article with many of the posts either venturing off into unrelated topics or missing the essence of credit scoring or predictive models.
First of all, modeling is not about cherry picking the best accounts. Rather, it is about pricing risk at an appropriate level or the level at which the carrier expects to earn a desired profit. With models placing accounts in quartiles or deciles, the carrier would write a risk or insured in a higher or worse decile all day long as long as it is priced appropriately. By “right pricing” risks, the carrier is attempting to optimize its ability to earn a profit on its book of business. Of course, though, it is likely a carrier would employ a strategy aimed at writing accounts up and down the lift curve comprised of those quartiles or deciles.
If the carrier prices to high or has an excessive profit target, then they will have difficulty attracting customers. If the carrier underprices business, then might attract plenty of clients but at the expense of profitability.
Modeling also has at its core a critical principle of insurance — the law of large numbers. There will always be loss free (both past and future) risks or insureds in a category deemed to have a high propensity for loss. Actually, the most common loss ratio for insureds in a higher or worse decile might actually be zero. However, as a group those insureds are expected to perform worse than average in terms of loss activity. The expectation is based, in many instances, on highly sophisticated predictive models using such variables as credit score, loss history, driving records, premium payment history, age of driver(s), age of vehicle, crime statistics, etc.
Another issue that seems to be lost on many posters is the company-specific nature of many predictive models. There are certainly “off the shelve” models carriers can purchase. However, many carriers have allocated significant resources to developing models using many years of their own loss experience as well as data or variables deemed to be very predictive in terms of expected losses. It is in a carrier’s best interest to bring in as many variables or predictors of loss. A signnificant amount of analysis, testing and monitoring are involved in any good modeling initiative.
The bottom line is that insurance carriers want to achieve an optimal balance between the need to generate revenue and profit (i.e. wealth). Cherry picking might maximize profit, but drive down revenue and/or market share. Chasing business by underpricing it could certainly provide a boost to revenue and/or market share, but will likely tank profitability.
Putting aside misinformation, “insurance carrier haters” and conspiracy theories, credit scoring or predictive modeling is nothing more than a highly sophisticated underwriting process. Instead of using humans and/or tables to price an insured based on a handful of variables, models can use dozens of variables to more accurately predict loss and, therefore, accurately price a risk. Whether a carrier is “old school” or state of the art, they need to attract clients and earn a profit. Business is business, people, regardless of the methods used to analyze and acquire customers, so take a thoughtful approach to this subject in lieu of the misinformation and hate.
Buckeye, I will bet you $16.2 billion dollars in bail out money not one of the anti insurance posters will read or care about your informative and well written post. Thanks for putting a head on it.
Nobody Important – Glad to contribute in my own little way. I appreciate the opportunity to wager, but I’m thinking it might be a sucker bet. Of course, $16.2B could fall out of our pocket considering we are all “owners” of what used to be the largest insurance company in the world. Stay low and keep moving….it’s a jungle out there.
You’re just not getting it. Beleive what you want, conspire how you wish, continue to be upset or disgruntled or whatever it is.
I tried to explain it in simple terms but you obviously are choosing to see how YOU want to see it and nothing else. I imagine it could be explained a 100 different ways and you seem the type that won’t care or be open to the reality of the truth of it.
The U.S. Court of Appeals for the Ninth Circuit has ordered a federal district court in Oregon to determine whether the public can see court records and evidence in a consumer fraud case that State Farm Insurance Company has battled for eight years to keep secret. On June 18, 2003, the Court of Appeals issued a long-awaited decision in State Farm v. Foltz reversing a trial court ruling that permitted the blanket sealing of discovery materials and court records in a consumer fraud case against State Farm Insurance Company. Trial Lawyers for Public Justice (TLPJ), a nationwide public interest law firm that intervened in the case on behalf of several non-profit groups that monitor insurance fraud, had urged the Court to rule as it did.
The information, which has been under seal since the underlying case against State Farm settled in 1998, may contain important evidence of abusive insurance practices. The Court of Appeals ruled that the documents were improperly sealed without any demonstration of a legitimate need for secrecy, and sent the case back to the trial court to decide whether a compelling interest exists to justify sealing evidence of State Farm’s misconduct.
“You can’t have corporate accountability if you have unnecessary court secrecy.”
in a consumer fraud case that State Farm Insurance Company has battled for eight years to keep secret. On June 18, 2003, the Court of Appeals issued a long-awaited
Why should a company want to write a class of business that will cause them to lose money. No business should do that. 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) WHAT PART TO YOU ALL NOT GET?
government bailout that has now swelled to about $152- $152 billion.
U.S. regulators have asked nine major insurance companies to provide information about how they set prices for homeowners’ coverage. insurance makes billionS and .
billionS.
and billionS. WOW AND YOU ALL WANTED JOE the PUBLIC TO HAVE Credit Scoring,,,……………………..RE: about the rights of the policyholders LOUD NOISES Dec 31, 2008, 4:43 pm
RE: RE: RE: IQ Chief Executive Officer of State Fa Brokette Dec 31, 2008, 12:38 pm
RE: we should all be adults try cutting and paste this in Dec 31, 2008, 10:11 am
RE: RE: IQ Chief Executive Officer of State Fa nobody important Dec 31, 2008, Dec 31, 2008, 10:05 am
about the rights of the policyholders nobody important Dec 31, 2008, 10:01 am
RE: RE: RE: a tool-WHAT PART TO YOU ALL NOT GET? SAY I CAN Dec 31, 2008, 9:58 am
RE: RE: a tool-WHAT PART TO YOU ALL NOT GET? notthing about this HUH!!! Dec 31, 2008, 9:55 am
RE: RE: o-with little federal oversight Buckeye Dec 31, 2008, 9:38 am
RE: o-with little federal oversight Brokette Dec 30, 2008, 9:30 pm
o-with little federal oversight federal oversight. Dec 30, 2008, 8:29 pm
RE: a tool LOOK IT UP- Dec 30, 2008, 3:44 pm
RE: no right to information about an investigation class of business.- Dec 30, 2008, 3:42 pm
RE: W -see court records and evidence in a consumer fraud ca keep secret Dec 30, 2008, 3:38 pm
W -see court records and evidence in a consumer fraud case t misconduct. Dec 30, 2008, 3:33 pm
RE: To: Greg – Dec 29 12:59 PM Greg Dec 30, 2008, 3:03 pm
RE: RE: What are predictive models? Buckeye Dec 30, 2008, 2:51 pm
RE: What are predictive models? nobody important Dec 30, 2008, 2:43 pm
What are predictive models? Buckeye Dec 30, 2008, 2:14 pm
RE: To: Greg – Dec 29 12:59 PM nobody important Dec 30, 2008, 1:23 pm
To: Greg – Dec 29 12:59 PM Lame Brain Dec 30, 2008, 12:34 pm
Discussion thread? Buckeye Dec 30, 2008, 11:39 am
RE: haha – illiterate fool – Leave the country nobody important Dec 30, 2008, 11:32 am
haha – illiterate fool – Leave the country Mark Dec 30, 2008, 10:23 am
RE: IN SALT-LAKE nobody important Dec 30, 2008, 10:22 am
IN SALT-LAKE former in-house Dec 30, 2008, 10:16 am
RE: RE: RE: IQ Chief -WE CAN MAKE LAWS WORK FOR US BECAUSE W MAKE LAWS WORK FOR Dec 30, 2008, 10:09 am
RE: RE: RE: IQ Chief Executive Officer of State Fa Brokette Dec 30, 2008, 10:06 am
RE: RE: IQ Chief Executive – IS THAT SO BILL]. Don Quixote Dec 30, 2008, 10:02 am
RE: RE: IQ Chief Executive – IS THAT SO BILL]. Jake Dec 30, 2008, 10:01 am
RE: IQ Chief Executive – IS THAT SO BILL]. !A HAVE DONE NOTHING ABOUT ! Dec 30, 2008, 9:55 am
RE: RE: IQ Chief Executive on their financial strength Dec 30, 2008, 9:33 am
IQ Chief Executive Officer of State Fa Bill Dec 30, 2008, 9:33 am
RE: RE: IQ Chief Executive Officer of State Fa Two former in-house attorneys Dec 30, 2008, 9:22 am
Loud Noises Buckeye Dec 30, 2008, 7:31 am
not criminals – just a idiots in the insurance Dec 29, 2008, 8:56 pm
RE: to: greg ANGER Dec 29, 2008, 6:51 pm
RE: RE: – Its pretty simple They are not criminals – just a loco in la cabesa Dec 29, 2008, 6:35 pm
RE: RE: RE: from a great book!! Dec 29, 2008, 6:16 pm
RE: RE: RE: to: greg insguru Dec 29, 2008, 6:05 pm
RE: yourself about a subject.-thats the only way nobody important Dec 29, 2008, 3:38 pm
yourself about a subject.-thats the only way Dec 29, 2008, 3:10 pm
RE: you would not known the court has all of this….. watching these tapes Dec 29, 2008, 3:07 pm
RE: RE: RE: Nobody important is nobody smart nobody important Dec 29, 2008, 2:44 pm
RE: RE: Nobody important is nobody smart Delicious Pastries Dec 29, 2008, 2:32 pm
RE: Nobody important is nobody smart nobody important Dec 29, 2008, 1:26 pm
RE: RE: RE: to: greg nobody important Dec 29, 2008, 1:22 pm
RE: RE: from a great book!! nobody important Dec 29, 2008, 1:19 pm
RE: from a great book!! privileged?” Dec 29, 2008, 1:09 pm
RE: RE: To: Lame Brain Greg Dec 29, 2008, 12:59 pm
Nobody Important and Lame Brain Greg Dec 29, 2008, 12:55 pm
from a great book!! Dec 29, 2008, 12:51 pm
to: brokette Lame Brain Dec 29, 2008, 12:29 pm
Nobody important is nobody smart Darren Dec 29, 2008, 12:26 pm
RE: RE: to: greg Lame Brain Dec 29, 2008, 12:26 pm
RE: RE: RE: IQ rather than Credit – Correction Greg Dec 29, 2008, 12:16 pm
RE: RE: to: greg Brokette Dec 29, 2008, 12:15 pm
RE: to: greg nobody important Dec 29, 2008, 12:11 pm
RE: RE: IQ rather than Credit Greg Dec 29, 2008, 12:10 pm
RE: To: Lame Brain Lame Brain Dec 29, 2008, 12:10 pm
to: greg Lame Brain Dec 29, 2008, 11:57 am
To: Lame Brain Greg Dec 29, 2008, 11:48 am
RE: IQ rather than Credit Lame Brain Dec 29, 2008, 11:22 am
RE: IQ Chief Executive Officer of State Fa have them complete IQ tests Dec 29, 2008, 10:43 am
IQ rather than Credit Interesting Study Dec 29, 2008, 10:41 am
Scoring – Insuranceblame the govt and the banks. THE BIG CEO$$$ Dec 29, 2008, 10:39 am
RE: Credit Scoring and Insurance Greg Dec 29, 2008, 10:29 am
government to help it remain in business. loans Dec 29, 2008, 10:20 am
Credit Scoring and Insurance Average consumer Dec 29, 2008, 10:15 am
no right to information about an investigation policyholders have no right ,S Dec 29, 2008, 9:47 am
RE: To: National News • December 23, 2 nobody important Dec 29, 2008, 9:39 am
RE: a tool nobody important Dec 29, 2008, 9:38 am
To: National News • December 23, 2 Greg Dec 29, 2008, 9:37 am
a tool for Brokette Dec 29, 2008, 9:32 am
Hey Einstein Greg Dec 29, 2008, 9:28 am
Remeber the hey days One Dec 29, 2008, 9:23 am
repeal insurers anti trust exemption Fair Game Dec 29, 2008, 9:18 am
RE: RE: Abe 3:06 Brokette Dec 29, 2008, 9:17 am
RE: RE: RE: RE: Let’s use some logic in deciding the rules. Jr. said Dec 29, 2008, 9:15 am
RE: – Its pretty simple They are not criminals – just a lit Hope Dec 29, 2008, 8:58 am
RE: Abe 3:06 cheli Dec 29, 2008, 8:03 am
RE: CHELI 2:47 cheli Dec 29, 2008, 7:59 am
we should all be adults Pay more attention Dec 29, 2008, 2:17 am
– Its pretty simple They are not criminals – just a little Here is something I know Dec 29, 2008, 1:47 am
RE: RE: RE: TO Confidence led upright. You believed in honor experience says – – – Dec 29, 2008, 1:18 am
RE: RE: TO Confidence led upright. You believed in honor, an Peon Agent Dec 28, 2008, 9:14 pm
RE: TO Confidence led upright. You believed in honor, and th MELANIE Dec 28, 2008, 7:56 pm
TO BOB KOCHAN. from ‘ Randy DOWN Dec 28, 2008, 7:51 pm
RE: Interesting……point non-regulated world. Dec 28, 2008, 5:49 pm
RE: RE: RE: RE: RE: RE: @companies ask choice point to use f Einstein Dec 28, 2008, 10:29 am
RE: @companies ask choice point to use for them specifically National News • December 23, 2 Dec 27, 2008, 9:00 pm
RE: RE: RE: RE: @companies ask choice point to use for them On The Fox Dec 27, 2008, 8:50 pm
RE: RE: RE: @companies ask choice point to use for them spec insguru Dec 27, 2008, 3:47 pm
RE: RE: RE: RE: Are you kidding me insguru Dec 27, 2008, 3:46 pm
RE: RE: @companies ask choice point to use for them specific nobody important Dec 27, 2008, 3:24 pm
RE: RE: RE: RE: RE: @companies ask choice point to use for t insguru Dec 27, 2008, 3:09 pm
RE: RE: RE: RE: @companies ask choice point to use for them Peon Agent Dec 27, 2008, 1:31 pm
RE: RE: RE: @companies ask choice point to use for them spec insguru Dec 27, 2008, 12:24 pm
RE: RE: @companies ask choice point to use for them specific let me help you. Dec 27, 2008, 10:23 am
RE: RE: @companies ask choice point to use for them specific point Dec 27, 2008, 10:21 am
RE: @companies ask choice point to use for them specifically insguru Dec 27, 2008, 9:43 am
@companies ask choice point to use for them specifically. Melanie Dec 26, 2008, 8:59 pm
RE: RE: RE: RE: RE: Credit Scoring insguru Dec 26, 2008, 7:16 pm
RE: RE: RE: FTC Probing Insurers Over Credit-based Homeowner Greg Dec 26, 2008, 2:26 pm
RE: RE: RE: RE: RE: RE: RE: Credit Scoring Greg Dec 26, 2008, 1:54 pm
RE: RE: RE: FTC Probing Insurers Over Credit-based Homeowner SWFL Agent Dec 26, 2008, 1:50 pm
RE: RE: FTC Probing Insurers Over Credit-based Homeowners In InsIsMyPassion Dec 26, 2008, 12:00 pm
RE: RE: RE: RE: RE: RE: Credit Scoring No Way Dec 26, 2008, 11:36 am
RE: RE: RE: RE: RE: Credit Scoring Greg Dec 26, 2008, 10:29 am
RE: FTC Probing Insurers Over Credit-based Homeowners Insura Greg Dec 26, 2008, 10:25 am
RE: RE: RE: RE: Credit Scoring RateAdequacy Dec 26, 2008, 10:19 am
RE: RE: RE: Credit Scoring Greg Dec 26, 2008, 9:36 am
RE: RE: RE: RE: RE: staffman – Its pretty simple Santa Clause Dec 24, 2008, 2:34 pm
RE: RE: To Old Ins Guy & Peon Agent Brokette Dec 24, 2008, 11:41 am
RE: To Old Ins Guy & Peon Agent Peon Agent Dec 24, 2008, 11:30 am
RE: RE: RE: RE: RE: staffman – Its pretty simple Peon Agent Dec 24, 2008, 11:27 am
To Old Ins Guy & Peon Agent Brokette Dec 24, 2008, 11:21 am
RE: RE: RE: RE: staffman – Its pretty simple Actuary Dec 24, 2008, 10:59 am
RE: RE: Auto Notification – Mike & Jake Peon Agent Dec 24, 2008, 10:35 am
RE: RE: RE: RE: staffman – Its pretty simple staffman Dec 24, 2008, 10:31 am
RE: RE: RE: staffman – Its pretty simple Mike Dec 24, 2008, 10:26 am
RE: RE: staffman – Its pretty simple staffman Dec 24, 2008, 10:19 am
RE: RE: Auto Notification – Mike & Jake Old Ins Guy Dec 24, 2008, 10:06 am
RE: Auto Notification – Mike & Jake Brokette Dec 24, 2008, 10:02 am
RE: RE: staffman – Its pretty simple – Idiot!!!! Ralph Dec 24, 2008, 9:33 am
RE: staffman – Its pretty simple Bob Dec 24, 2008, 9:25 am
staffman – Its pretty simple Mike Dec 24, 2008, 9:23 am
Income issue staffman Dec 24, 2008, 9:14 am
RE: Auto Notification Jake Dec 24, 2008, 9:13 am
Auto Notification Mike Dec 24, 2008, 9:12 am
RE: RE: RE: Let’s use some logic in deciding the rules. Juliet Dec 24, 2008, 9:10 am
RE: RE: Let’s use some logic in deciding the rules. Obama Gurl Dec 24, 2008, 8:52 am
RE: Let’s use some logic in deciding the rules. Obama Gurl Dec 24, 2008, 7:54 am
Let’s use some logic in deciding the rules. Democratic Logic Dec 24, 2008, 7:43 am
RE: RE: Why I do not accept the – Dar 6:23 nobody important Dec 24, 2008, 7:04 am
To please……please!! Buckeye Dec 24, 2008, 6:15 am
RE: RE: Why I do not accept the – Dar 6:23 EGoyle Dec 23, 2008, 9:03 pm
RE: Why I do not accept the – Dar 6:23 Brokette Dec 23, 2008, 6:50 pm
Why I do not accept the “Credit Scoring” studies DarNovak Dec 23, 2008, 6:23 pm
RE: Why I do not accept EGoyle Dec 23, 2008, 6:08 pm
Why I do not accept “Ccredit Scoring” DarNovak Dec 23, 2008, 5:53 pm
RE: RE: RE: RE: RE: Are you kidding me – Mike 3:50 Seriously Dec 23, 2008, 5:21 pm
RE: RE: RE: Are you kidding me – Mark 3:34 LOL – Right Dec 23, 2008, 5:15 pm
RE: standardized score EGoyle Dec 23, 2008, 5:09 pm
RE: RE: RE: RE: Are you kidding me – Mike 3:50 Brokette Dec 23, 2008, 5:08 pm
standardized score nick Dec 23, 2008, 4:41 pm
RE: RE: Are you kidding me (Rick) Mark Dec 23, 2008, 4:06 pm
RE: RE: RE: Are you kidding me Mike Dec 23, 2008, 3:50 pm
RE: RE: Are you kidding me Mark Dec 23, 2008, 3:44 pm
RE: RE: Are you kidding me – Nope Insurance Man Dec 23, 2008, 3:43 pm
RE: Are you kidding me Rick Dec 23, 2008, 3:38 pm
RE: Are you kidding me – Nope Abe Dec 23, 2008, 3:37 pm
Are you kidding me Insurance Man Dec 23, 2008, 3:31 pm
Wow Peon Agent Dec 23, 2008, 3:31 pm
RE: FDA & The Drug Companies Matt Dec 23, 2008, 3:28 pm
RE: RE: RE: RE: Hey Brook? Will you take this bet? Mike Dec 23, 2008, 3:22 pm
FDA & The Drug Companies One Who Doesn’t Get It Dec 23, 2008, 3:20 pm
In with the new and out with the evil old ones Waiting on Obama to take over Dec 23, 2008, 3:19 pm
RE: RE: RE: Hey Brook? Will you take this bet? Brokette Dec 23, 2008, 3:17 pm
RE: RE: RE: Common Sense joe Dec 23, 2008, 3:15 pm
Abe 3:06 Rick Dec 23, 2008, 3:14 pm
Peon Agent?? I don think so… Mike Dec 23, 2008, 3:13 pm
RE: RE: Common Sense Peon Agent Dec 23, 2008, 3:09 pm
RE: RE: RE: Hey Brook? Will you take this bet? Abe Dec 23, 2008, 3:06 pm
RE: RE: Hey Brook? Will you take this bet? Doug Dec 23, 2008, 3:05 pm
CHELI 2:47 Rick Dec 23, 2008, 3:01 pm
RE: Vegans vs meat eaters joe Dec 23, 2008, 2:51 pm
RE: InsMgmt 2:13 CHELI Dec 23, 2008, 2:47 pm
RE: Hey Brook? Will you take this bet? Brokette Dec 23, 2008, 2:45 pm
Vegans vs meat eaters We try not to write vegans Dec 23, 2008, 2:44 pm
InsMgmt 2:13 Rick Dec 23, 2008, 2:44 pm
RE: RE: Hey Brook? Will you take this bet? Doug Dec 23, 2008, 2:39 pm
RE: Hey Brook? Will you take this bet? CHELI Dec 23, 2008, 2:37 pm
RE: RE: Common Sense joe Dec 23, 2008, 2:36 pm
RE: RE: Compassion? Brook Dec 23, 2008, 2:35 pm
Hey Brook? Will you take this bet? Mike Dec 23, 2008, 2:33 pm
RE: Compassion? Brokette Dec 23, 2008, 2:30 pm
RE: RE: SOCIALIZED INSURANCE brad Dec 23, 2008, 2:28 pm
Compassion? Actuary Dec 23, 2008, 2:28 pm
Rates are like water… Vlad Dec 23, 2008, 2:27 pm
RE: RE: RE: Common Sense – Jake 2:19 Brokette Dec 23, 2008, 2:26 pm
RE: RE: RE: Common Sense – Rachel 2:11 CHELI Dec 23, 2008, 2:24 pm
RE: RE: Common Sense – Rachel 2:11 Brokette Dec 23, 2008, 2:23 pm
RE: RE: RE: Common Sense CHELI Dec 23, 2008, 2:21 pm
RE: RE: Common Sense Jake Dec 23, 2008, 2:19 pm
RE: RE: Common Sense – Joe Doug Dec 23, 2008, 2:16 pm
RE: Common Sense joe Dec 23, 2008, 2:14 pm
RE: Credit Scoring CHELI Dec 23, 2008, 2:14 pm
Rick 1:41 InsMgmt Dec 23, 2008, 2:13 pm
RE: Govt Assessable Mutual Insurance Stat Guy Dec 23, 2008, 2:12 pm
RE: Common Sense Rachel Dec 23, 2008, 2:11 pm
RE: RE: SOCIALIZED INSURANCE Brokette Dec 23, 2008, 2:10 pm
RE: RE: In Texas Whitey pays same as others including Obama Stat Guy Dec 23, 2008, 2:06 pm
Common Sense Ralph Dec 23, 2008, 2:05 pm
RE: SOCIALIZED INSURANCE Porfirio Dec 23, 2008, 2:01 pm
RE: experience says – – – Mrs Dean Wormer Dec 23, 2008, 1:58 pm
RE: RE: RE: Interesting……how it’s supposed to work.. Stat Guy Dec 23, 2008, 1:57 pm
Lets do a study on NASCAR Ricky Rud Dec 23, 2008, 1:53 pm
RE: SOCIALIZED INSURANCE brad Dec 23, 2008, 1:48 pm
RE: Govt Assessable Mutual Insurance brad Dec 23, 2008, 1:45 pm
SOCIALIZED INSURANCE NEVER FEAR THE OBAMA IS HERE Dec 23, 2008, 1:43 pm
InsMgmt 1:15 Rick Dec 23, 2008, 1:41 pm
RE: Pat 11:41 Pat Beranger Dec 23, 2008, 1:40 pm
RE: Good Posts Bill Dec 23, 2008, 1:37 pm
RE: Scoring – cd 1:12 Ratemaker Dec 23, 2008, 1:32 pm
To Please Bill Dec 23, 2008, 1:32 pm
Bob 12:49 InsMgmt Dec 23, 2008, 1:26 pm
RE: RE: RE: Govt Assessable Mutual Insurance ins product manager Dec 23, 2008, 1:25 pm
FTC Probing Insurers Over Credit-based Homeowners Insurance RolfNeu Dec 23, 2008, 1:25 pm
to please….. Bob Dec 23, 2008, 1:23 pm
Sick of race card Bill Dec 23, 2008, 1:22 pm
Pat 11:41 InsMgmt Dec 23, 2008, 1:17 pm
George 11:28 InsMgmt Dec 23, 2008, 1:15 pm
Rick 11:32 InsMgmt Dec 23, 2008, 1:13 pm
Scoring cd Dec 23, 2008, 1:12 pm
Curious 12:49 Hawk Dec 23, 2008, 1:11 pm
RE: RE: Govt Assessable Mutual Insurance staffman Dec 23, 2008, 1:07 pm
Good Posts Ray Dec 23, 2008, 1:06 pm
fact…. m & m Dec 23, 2008, 1:03 pm
RE: Govt Assessable Mutual Insurance The Soprano Family Dec 23, 2008, 12:54 pm
sam the claims guy Rick Dec 23, 2008, 12:52 pm
Govt Assessable Mutual Insurance ins product manager Dec 23, 2008, 12:51 pm
RE: RE: Credit Scoring Curious Dec 23, 2008, 12:49 pm
To InsMgmt Bob Dec 23, 2008, 12:49 pm
Credit Scoring Dec 23, 2008, 12:46 pm
RE: Obama is going to fix this. Hope & Change Be A Coming! Dec 23, 2008, 12:44 pm
RE: Credit Scoring Texas Dec 23, 2008, 12:43 pm
RE: RE: RE: In Texas Whitey pays same as others including Ob Glennie Dec 23, 2008, 12:32 pm
experience says – – – sam the claims guy Dec 23, 2008, 12:22 pm
RE: RE: In Texas Whitey pays same as others including Obama please….. Dec 23, 2008, 12:20 pm
RE: In Texas Whitey pays same as others including Obama Jack J Maniscalco Dec 23, 2008, 12:18 pm
RE: Credit Scoring company gal Dec 23, 2008, 12:16 pm
In Texas Whitey pays same as others including Obama Texas Agent Dec 23, 2008, 12:03 pm
RE: Credit Scoring nobody important Dec 23, 2008, 12:02 pm
RE: Law-yer. 11:24 Ned Dec 23, 2008, 11:58 am
RE: RE: Obama is going to fix this. Barack Obama Dec 23, 2008, 11:57 am
RE: Obama is going to fix this. glennie Dec 23, 2008, 11:56 am
Obama is going to fix this. Obama’s gonna fix all this! Dec 23, 2008, 11:54 am
Credit Scoring John Q. Agent Dec 23, 2008, 11:49 am
RE: Credit Scoring
Well said, Brokette. An insurance policy is a contract entered into by two parties for consideration in the form of premium. In many instances, the transaction is facilitated by a professional third party called an agent.
It is very simple — claims are either adjusted in accordance with the contract or they are not. If they are not, then the policyholder has legal recourse against the insurance carrier. If a professional third party (i.e. agent) was involved in the transaction, then the policyholder should have additional leverage and support from said professional third party.
As previously stated, the insurance carrier hate, conspiracy theories and illogical emotion are unproductive and ludicrous. Insurance carriers are obligated to take responsibiliy for the contracts they enter into. If they violate the contract, then they are held accountable. What far too many people (including many so-called insurance professionals posting on this site) tend to forget is that policyholders are assumed to be a responsible party entering into the same contract. The contractual nature of the insurance policy is intended to protect the interests of the policyholder. If the policyholder acts in an irresponsible manner when he/she enters into the contract (e.g. not paying attention to terms and conditions or simply purchasing the cheapest product in lieu of the desired or necessary coverage in the event of loss), then the policyholder will find himself/herself in the unfortunate position of being held accountable for acting in an irresponsible manner.
MY DEAR FRIEND IS WHY THIS COUNTY IS IN THE HUGH MISS – IT,S -IN . KNOW ONE WANTS TO STEP UP TO THE PLATE WHAT A SICK DIAGNOSE .WAKE UP – PLEASE IT,S TIME.
. 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- .
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.
“Two former in-house attorneys for State Farm contend that they were often called upon…”
I wonder how many times is “often” and did these attorneys admit to this unethical behavior only after they’d been caught red-handed in the course of policyholder bad faith litigation? If refusing to engage in illegal/unethical behavior costs me my job, so be it. Apparently, these attorneys possess no such “convictions”. Double entendre intended.
So I see that the insurance scoring forum has now turned into a “let’s rant and rave about any non-sensical subject we can” OR, my personal favorite “let’s just plain put each other down because we can’t come up with anything intelligent to say” Here’s food for a thought – how old is everyone on here?? Just curious???
Agreed. I think what most insurance professionals object to is a bunch of politically correct buffoons who’ve had zero executive experience sticking their lobbyist bribe soaked hands in our business. Our business does NOT have anything close to a monopoly so the insurance haters need to stop posting as if they have no choice, shop their insurance and take some responsibility for their lives. Stop pretending your homeowner’s carrier is holding you hostage (no matter how they underwrite and price their product). Maybe if you’d take more interest in the terms of your insurance policy than your iPod, you’d have good coverage at a fair price, but you don’t do that, do you?
I think you have it backwards. The lobbyists are working much more for the benefits of the insurance companies, and that my dear is fact. I’m not sure where you get the idea that lobbyists are benefiting the consumer when they work directly for the insurance giants. You recommend that we stop pretending that our homeowner’s insurance is holding us hostage. What else would you call it when you pay insurance premiums for years and when disaster strikes you are lucky if you get 25 cents on the dollar? Do you think the mortgage companies care that now your home is basically worthless and you still have the balance to pay off? People believe the commercials that they see on TV and that’s why companies use words like “good neighor” “good hands” “American” “Family” etc. These companies spend billions of dollars telling us how great they are and billions in court not paying what the policy provisions say they will pay. Why not just pay the claims and save the advertising and legal fees? Can you imagine what THAT would do for the world? You know that top attornies write these policies and there are other top attornies that try to interpret them and still don’t know what they are saying. If you look up some of the terms in the dictionary you will find that the dictionary says one thing and the insurance world means another. I have posted records that are open for you to look up and verify these facts yourself. There are court documents all over this country that will tell you that there is something wrong with your industry. I do not hate your industry. What I hate is the injustice and the insanity because it is the Mom’s and Pop’s of this world that pay for this nonsense. I don’t know about you but for this New Year this little light of mine will shine and we shall overcome. Some seeds will fall on fertile ground and some will not. With the poor I will cast my lot!
IT,S A MESSAGE OF TOLERANCE
Comment:
One of your comments was “I apologize that my product doesn’t function like welfare OR therapy, sir.” You can call me DEAR it’s okay. Welfare? Wow, this is not good therapy. I DO NOT KNOW ABOUT YOU BUT WE ALL PAY YEAR AFTER YEAR FOR YOUR so called welfare TO YOUR CEO’S. THE MILLONS BEING PAID TO THE TOP CEO’S represent corporate welfare that the poor are paying for. AS FOR IGNORANCE, if you think insurance company lobbyists are the ones who are responsible for the attorneys acting unethically–well, I can only assume you don’t understand the lobbying process’ A NEW YEAR– HOW MUCH CLOSER ARE WE TO THE ENLIGHTENMENT THAT WOULD TAKE US BEYOND SUCH BEHAVIOR.
KNOW ONE ON THIS PLANT IS WORT
Comment:
Willumstad earlier waived a $22.5 million severance payment that he would have been due, This my friend is where the problem lies. KNOW ONE ON THIS PLANT IS WORTH $22.5 million . THIS IS THE Writing on the Wall.THE TOP CEO’S represent corporate welfare that the poor are paying for. AS FOR IGNORANCE, if you think insurance company lobbyists are the ones who are responsible for the attorneys acting unethically–well, I can only assume you don’t understand the lobbying process’ A NEW YEAR– HOW MUCH CLOSER ARE WE TO THE ENLIGHTENMENT THAT WOULD TAKE US BEYOND SUCH BEHAVIOR. – IT,S A MESSAGE .
As a noted feminist once said, “I am NOT your dear.” Since you are clearly outside of the insurance industry, I wouldn’t expect you to understand its purpose. As our society has become increasingly socialist (let’s please stipulate to that as arguing the point will only make you look ignorant), we’ve come to expect insurance to function like welfare so no one (especially the sainted poor) would have to suffer ANY kind of loss, monetary or emotional. Well, I apologize that my product doesn’t function like welfare OR therapy, sir. It is, by definition, designed to put the policyholder back in the same place they were prior to the loss. If they lived in a dilapidated 100 year old shanty, that’s what they get. There is no doubt that the insurance industry has some bad actors, just like all industries and just like the government. I’ll bet “Hot” Rod Blagojevich cares nothing for the sainted poor folks. He plays the part (like you do) and hopes for redemption. And if you think insurance company lobbyists are the ones who are responsible for the attorneys acting unethically–well, I can only assume you don’t understand the lobbying process. See lobbyists go to POLITICIANS and buy their votes. Oh, and by the way, I would submit that (like California) whenever the populace gets the opportunity to elect an insurance commissioner they vote for the guy (or “gal”, to use your vernacular) who promises to “stick it” to the insurance companies. Wherever there’s a contract (insurance policy), there will always be disputes. Just think how many attorneys we’d need if there weren’t.
One of your comments was “I apologize that my product doesn’t function like welfare OR therapy, sir.” You can call me DEAR it’s okay. Welfare? Wow, this is not good therapy. I DO NOT KNOW ABOUT YOU BUT WE ALL PAY YEAR AFTER YEAR FOR YOUR so called welfare TO YOUR CEO’S. THE MILLONS BEING PAID TO THE TOP CEO’S represent corporate welfare that the poor are paying for. AS FOR IGNORANCE, if you think insurance company lobbyists are the ones who are responsible for the attorneys acting unethically–well, I can only assume you don’t understand the lobbying process’ A NEW YEAR– HOW MUCH CLOSER ARE WE TO THE ENLIGHTENMENT THAT WOULD TAKE US BEYOND SUCH BEHAVIOR.
It’s about time Insurance companies were forced to actually hold up their end of the contract. They’re much better at collecting premiums than at paying legitimate costs associated with losses.
I am convinced that my policies are designed so that I will never be covered for what I think I am.
Once again this industry proves they are unable to act ethically.I hope these guys have to pay billions in restitution. In fact I would go a step further and put the CEO’s and Corporate officer’s in prison.Why are we legally forced to buy insurance which is totally useless?
THIS IS WHAT PEOPLE THINK ABOUT AND TALK ABOUT. http://www.clarionledger.com/assets/pdf/D069388410.PDF
We should be using this website as a tool to gain more knowledge about our industry to do our job better. Pay more attention to what they are trying to say.
I submit that in very few instances are we legally obligated to buy insurance. We are legally obligated to prove we can meet certain financial responsibilities to third parties i.e. your mortgage holder, people you damage or injure while driving a car. However, most laws provide for an alternate method of meeting these financial responsibilities. Bonds can be posted, fiduciary accounts established, et al. You’re not required to purchase a homeowner’s policy–buy a dwelling fire policy and pay less to the dirty rotten insurance companies. Then when your house is destroyed you can replace your own personal belongings. When policyholders say things like, “I had to inflate my claim to recover my deductible” or “I had to hose down the rest of my carpet to get it all replaced”, one doesn’t have to wonder why insurance companies are cautious in their investigation of claims. You might think this is justified because “insurance companies never pay claims” but the truth is that these types of policyholders make the insurance company less likely to believe YOU when a loss occurs. Maybe you should direct your hate toward the perpetrators of fraud. Personally, I don’t appreciate being judged by the lowest common denominator at all.
HAHAHAHAHA! Clearly you haven’t been reading the Forbes Top 100 of Highly Paid CEO’s. If you had, you’d know that Insurance Company CEO’s RARELY make the list. Order the back issues of Forbes for reference. And if an insurance company is such a profitable enterprise, why aren’t their shares trading at higher prices? Hmmmm.
I continue to suggest the revolutionary act of reading an insurance policy. Peoples’ unrealistic expectations of its purpose typically leads to their discontent with a policy’s benefits.
HEADLINE:State Farm Claims Actions Under Fire: Use of Biased Reporting Found
By Anita Lee, The Sun Herald, Biloxi, Miss.
Nov. 16–As instructed, State Farm catastrophe manager Alexis “Lecky” King refused to answer questions an Oklahoma attorney fired at her for one hour and 10 minutes.
Instead, she repeated the same phrase 87 times: “Because of the ongoing state and federal investigation, on advice of counsel, at this time, I must invoke my constitutional right to remain silent.”
[She would not tell the attorney why State Farm ordered a second damage report on property when the first showed a policyholder’s losses were covered]. Nor was she willing to discuss why State Farm went with that second report, finding little or no covered damage.
It happened after an Oklahoma tornado and, records show, on the Mississippi Coast after Hurricane Katrina.
“Do you believe as a team manager — catastrophe team manager — that you owe any of either the policyholders in Oklahoma who endured their catastrophe of May 1999 or the policyholders who suffered losses in Katrina any type of apology?” asked the Oklahoma policyholders’ attorney, Jeff D. Marr.
Same answer.
“Can you tell myself and this jury what it will take, what the next jury in January, or any juries down in the Gulf Coast states need to do in order to ensure that State Farm stops this kind of behavior?” Marr asked.
State Farm’s attorney objected to the question.
It didn’t matter. King feared answers might incriminate her because she is the target of a state grand jury investigation in Mississippi regarding the insurance industry’s claims practices after Katrina. She was even unwilling to say what route she took to reach the Nov. 3 meeting in Pensacola, Fla., where she lives.
The Oklahoma Supreme Court compelled King, along with State Farm executives from Bloomington, Ill., headquarters, to submit under oath to Marr’s questions.
An Oklahoma jury in May found that State Farm “recklessly disregarded” its duty to deal fairly with policyholders, doing so “intentionally and with malice” through the use of biased expert opinions after the 1999 tornado. The tornado, one of many to strike May 3, 1999, reached a strength of F5, the most catastrophic on the Fujita scale.
As a result, the first of Marr’s tornado clients collected $13 million in damages. Marr hopes to show State Farm’s behavior continued in Mississippi. By doing so, he could secure higher damages for 70 more members of his class-action lawsuit in Oklahoma.
State Farm issued a statement Friday in response to Sun Herald questions about the legal activity: “The tornado that struck Oklahoma City in 1999 and Hurricane Katrina are two separate events,” the company said. “We handle claims individually and pay what we owe based on the contract with the policyholder.”
Marr is sharing information with Mississippi attorneys representing hundreds of State Farm policyholders whose homes Hurricane Katrina damaged or destroyed.
He also is sharing information with the Mississippi attorney general, who has convened the grand jury investigation, and with the U.S. Justice Department, which has launched a probe of its own.
In fact, Marr has announced to the world on his Web site, http://www.marrlawfirm.com., where to secure court records about State Farm.
State Farm attorneys have fought to keep employee testimony private in Oklahoma and Mississippi. In fact, at State Farm’s request, an Oklahoma judge has forbade further discussion of the case by Marr and the other attorneys. State Farm is using court protections and procedures, the company said, available to all parties in a lawsuit.
As cases in both states grind forward, more information comes to light.
Executives for the nation’s largest property and casualty insurer deny any intentional misconduct. They said the company worked with nationally recognized engineering firms to help determine what policyholders were owed in less than 2 percent of 84,000 Katrina claims in Mississippi.
In sworn testimony this summer in Oklahoma, company chairman and CEO Edward B. Rust Jr. said: “And that is ultimately my concern, also, is that we want to be fair with our customers. After all, the success of this organization is driven by our ability to retain current customers and to attract new customers. The last thing we want to do is be unfair with our customers.”
Rust has not testified in Mississippi, but Lecky King did. Her testimony in a federal lawsuit filed in Gulfport is under wraps on orders from U.S. Magistrate Judge Robert H. Walker. Attorneys can’t discuss what she did or did not say.
Two State Farm whistleblowers said, King and assistant Lisa Wachter were the only employees in the Coast office allowed to communicate with engineering firms the company used to help sort out what State Farm owed some policyholders after Katrina. Normally, the whistleblowers have said, State Farm adjusters communicated directly with engineering firms.
When a report blamed the covered peril of wind for damage, the whistleblowers said, King ordered another to show the culprit was water, covered by the federal flood insurance program. The company finally called a halt to the reports altogether, the whistleblowers said, because too many showed wind damage.
Joe Hollomon, once a federal prosecutor himself, said his clients, King and Wachter, had nothing to gain by denying claims and were here to help policyholders. In Oklahoma, King’s testimony is a matter of public record, but the attorneys are not allowed to hand it out.
Hollomon told Marr before the questions started: “Obviously, we’re, you know, that’s a matter of concern to myself and my client. She’s going to assert her constitutional privilege and, of course, the dissemination of that could obviously prejudice her if we one day find ourselves in front of a jury somewhere in Mississippi, so, you know, we’re very concerned about that.”
——
State Farm engineering reports
Below are engineering reports recently filed as part of the Oklahoma lawsuit:
Larry Lowe residence, Oklahoma City
May 24, 1999: Strum Engineering, Oklahoma City, hired by State Farm, concluded high winds racked the roof, causing rafters to separate from the ridge, which could lead to leaks from rain and eventually create safety issues. Repairs recommended.
June 11, 1999: State Farm asked Haag Engineering to examine the house. Haag concluded in a report issued July 21: “It is our opinion that the Love (sic) residence was not structurally damaged by wind, and the frame requires no repairs.”
Michael and Lisa Pole property, Oklahoma City
July 19, 1999: Strider Associates, hired by the Poles, found tornado damage to roof framing, decking and brick veneer, all requiring replacement.
July 27, 1999: A State Farm claims representative makes note of the Strider report and repairs recommended, then concluded, “I believe we should hire a structural engineer to inspect and provide us with their expert opinion.”
Aug. 18, 1999: Inspecting for State Farm,Haag Engineering concluded, “The primary structural system of the Pole residence had not been damaged by wind.” Wind damaged only a few roof shingles, the report says.
Terri Mullins property, Kiln, Miss.
Oct. 23, 2005: Forensic Analysis & Engineering Corp., hired by State Farm, concluded “the primary and predominant cause of damage to the subject property was due to hurricane force winds. This is based on the displacement of the house and the absence of water damage to the same.”
Jan. 3, 2006: A second Forensic Analysis report says wind caused “tree failures,” the cause of interior damage is undetermined and that “movement of the house across the street with “minimal obvious wind damage is consistent with a buoyant force applied to the building by rising water allowing the wind to blow the house northwards until it reached an obstruction.” (State Farm interprets its policies to say wind damage is not covered when water contributes.)
Thomas and Pamela McIntosh property, Biloxi
Oct. 12, 2005: Forensic Analysis & Engineering Corp. concluded roof, door, carport and window damage was caused by wind, along with interior damage. The report State Farm ordered included a sticky note on the first page that said, “Put in Wind file — DO NOT Pay Bill, DO NOT discuss.”
Oct. 20, 2005: Forensic concluded wind damaged shingles, along with the second story floor and first floor ceilings, but said “damage to first floor walls and floors appears to be predominately caused by rising water.”
State Farm issued the following statement Friday regarding its handling of policyholder claims. It reads, in part:
“The tornado that struck Oklahoma City in 1999 and Hurricane Katrina are two separate events. We handle claims individually and pay what we owe based on the contract with the policyholder.
“State Farm occasionally seeks the help of nationally recognized engineering firms to assist us in determining the cause of loss.
“Following last year’s hurricanes, we sought assistance from these firms in less than 2 percent of the 84,000 claims filed in Mississippi. Katrina was an unprecedented event and in a small number of claims there was more than one engineering report due to multiple reasons.
“Our intent was to seek assistance to help us settle claims with our policyholders.”
—–
Copyright (c) 2006, The Sun Herald, Biloxi, Miss.
Distributed by McClatchy-Tribune Business News.
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Dec. 31–After the confetti settles from tonight’s New Year’s eve celebrations, Utahns will face a few changes as a dozen new state laws take effect.
One in particular, Sen. Sheldon Killpack’s SB149, mandates increased motor vehicle liability insurance coverage — from $50,000 to $65,000 — for bodily injury of two or more people.
As a result, premiums are expected to rise, but to what extent will vary according to carrier and type of coverage.
While those well-off likely won’t see much difference, the working poor will feel the pain and the ranks of the uninsured will increase, predicts Gary Thorup, an attorney for Property Casualty Insurance Association of America.
“There are currently people who are marginally paying for their insurance,” Thorup said. “As those rates go up, obviously wallets will be stretched even further. If it’s the choice of feeding my family and taking the chance of being uninsured, I will probably opt for the first.”
The bill’s backers pushed for higher coverage requirements to pay for hefty medical costs incurred in serious accidents.
Paul McGarrell, an agent with Farmers Insurance, maintains that the bump to $65,000 does not go high enough.
“Medical bills being what they are, it’s still not a lot of coverage,” McGarrell said. “So when people are badly hurt, the bills can go way beyond that.”
However, as a company, Farmers Insurance lobbied against SB149.
“Farmers
opposed it because of the large number who drive uninsured,” McGarrell said. “They felt it would increase that number and that having some coverage is better than none.”
With the plummeting economy, people are shopping harder for rates, McGarrell added, and more are dropping collision and comprehensive coverage and opting for liability only.
The insurance industry needs to take a long, hard look at itself,” Spitzer said. “If the practices identified in our suit are as widespread as they appear to be, then the industry’s fundamental business model needs major corrective action and reform. There is simply no responsible argument for a system that rigs bids, stifles competition and cheats customers,” he added
John CommentS:
To add to the discussion, and respond to the one or two persons who posted what I perceived as unkind remarks earlier, what are you? Cold-hearted cynics? Or just terribly misinformed?
You certainly weren’t at the trial where the uncontradicted expert evidence was that hurricane force winds pounded the Kodrin home for HOURS before any flood waters touched it.
Even the defense expert had NO explanation for how the Kodrin home roof ended up 1000 feet across the road from the slab, having ended up in the same direction of earlier top-sustained winds, which arrived long BEFORE any significant flood waters arrived. And when significant flood waters did arrive, they may have only reached between TWO AND FIVE FEET up the walls of the Kodrin home, State Farm’s climatologist had to concede on cross-exam. And, once the flood waters did get deep enough to perhaps pose a threat – IF the home had still been standing at that point – the winds by then would have sent the roof at least 90 degrees in another direction (a virtual impossibility, we maintained).
But you didn’t know any of that, because you were not at the trial, as I was.
Re Burden of Proof – Under LA law, the burden is ALWAYS on the insurance company to prove the damaged or destroyed home is NOT covered and has the burden of proving why. But I hope you never have to have that debate as a devastated homeowner yourselves.
John W. Redmann, Attorney for the Kodrins
Subject Posted By Posted On
RE: RE: Burden of Proof – new policy forms John Redmann Nov 23, 2007, 2:36 pm
RE: Burden of Proof – new policy forms Kent Nov 12, 2007, 12:32 pm
RE: The Burden of Proof BEN BROKE Nov 8, 2007, 8:24 am
RE: The Burden of Proof Ol Man Of The Mountain Nov 7, 2007, 9:09 pm
Sad Realist Nov 7, 2007, 1:46 pm
RE: The Burden of Proof ad Nov 7, 2007, 1:33 pm
The Burden of Proof gg Nov 7, 2007, 1:06 pm
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Dear Mr. “take a hard look”, “investigation of claims”–blah, blah, blah:
You’re quoting a *****-monger??!? Someone who believed himself to be above the law or even above generally acceptable levels of human behavior? This is a joke, right? You’re really Bill Maher, aren’t you? Maybe you should take a meeting with someone in our industry like, say Warren Buffett–a man of unimpeachable integrity. And a political liberal–just so you can “feel” good about the source of information.
And way to re-direct the subject of fraud. Believe me, every insurance carrier who’s been proven to have committed illegal acts is taken to task in a big way. I’m sorry that you couldn’t get them to build you a mansion after your shanty was destroyed by Hurricane Katrina. That’s not what insurance is for. And you really should find something besides your tired old State Farm emails. That’s one insurance company. Let’s talk about some others. “You’re it!”
So now my question to you is: “When did owning a car or house become an entitlement of our system?” I had to work my butt off for YEARS to afford these things. In the interim, I lived in apartments or rented housing–took public transportation in a city of 500,000 that had no public transportation beyond a bus system. If MY insurance company was treating me this way, I’d surely file a report with our State DOI and find an attorney (there are millions of them) willing to take my case on contingency. I can assure you by the time it was all over my carrier would know the financial wrath that a bad faith suit can cause. I’m curious–why don’t you have any evidence of these problems occurring in the area of commercial insurance. Perhaps commercial insureds have a better understanding of the purpose of insurance while homeowner’s expect a mansion to replace their shanty. And why, exactly, does a dispute between wind and flood concern these folks? Oops! They didn’t buy flood insurance, did they? And therein lies the crux of the matter. They made a choice. They gambled and they lost. The chooser is accountable.
As a 10 year veteran of the catastrophe adjusting business, I’ve worked
on numerous State Farm projects, as well as for many other companies.
All with varying degrees of profit potential. What you’re about to read
is worth your time … trust me. It may save you from making a big
mistake.
We’ve all heard the horror stories which have been circulating for years
now, about how bad State Farm often treats it’s independent adjusters,
as well as their policy holders. To date, however, I’ve been mostly
spared the bad trips many other adjusters have experienced. I’ve made
money working for State Farm in the past, but it’s getting more and more
difficult, especially on a large CAT.
Now I have my own nightmare to add to the stories you’ve heard. By the
way, it’s true … they do behave like Nazi’s toward independents on
most of their projects, and care about as little for the independent
adjuster, as they do for their policy holders. For those who have worked
for what’s come to be known as Hitler’s “SF,” you know what I’m talking
about. The latest term I’ve heard to describe them in south Mississippi
is, “The Great Satan.” This is how angry people have become here.
This year I was begged, I mean literally begged by a certain
independent, to come and help them out on their hurricane Georges
operation in south Mississippi, because the adjuster before me had
ditched the storm. Fool that I was, I went to try and help out, only to
get the worst screwing I’ve gotten in a very long time.
To begin with, at least a third of the flood files I was given, required
underwriting reformation before a scope could be agreed to, or any
advances issued. This process was taking up to 30 days when I left. Keep
in mind, in many cases these are people out of their homes without
additional living expenses. Many were so upset, that they were either in
tears when I arrived, or furious that they couldn’t get any advance
money. Add to this the problem of closing these files. You can’t close a
flood claim that is being corrected for underwriting errors. You can’t
bill it either. We couldn’t even close our no claims, until what has
come to be known as “The Reformation” is completed on the policy.
When I asked one of their wealthy agents, who’s home I just happened to
be handling for minor flood damage, what an elevated structure was, the
agent admitted to me that she had no clue. And that she had not even
been to a seminar or workshop on the subject, because they were
inconveniently held out of town. Far from being an isolated case, there
are hundreds, possibly thousands of State Farm policy holders all across
the southern Gulf Coast, who are getting screwed more than they usually
do by State Farm, all because the company failed to properly school
and(or) test their agents on how to accurately file the underwriting on
a dwelling flood policy.
But the nightmare doesn’t end there, the poor people in many cases will
owe money when the underwriting errors are corrected, because they were
being undercharged on their coverage, for in some cases YEARS! Try
handling a claim where, because of the hurricane, the policy holder owes
the insurance company money!!! It’s the most negligent situation I’ve
ever encountered since I started adjusting. It wouldn’t surprise me to
see a class action lawsuit against them for this, if their isn’t one
already.
And get this, the policy holders all say that after they purchased their
policies, someone came out and inspected their homes in order to verify
the application. Makes you wonder who’s watching the store here.
Amazing how these hypocritical bastards will nickel and dime the poor
people to death, meticulously handling their disaster claims to
undeniable lean accuracy. Only to handle the underwriting with such a
disregard for correctness, as to cause a second catastrophe in the poor
people’s lives.
It’s as if someone owned a grocery store, who didn’t care to manage the
receipts for his wholesale inventory, but managed to death, the check
out clerks, the bagboys, and the customers for shoplifting concerns.
Going so far as to do body cavity searches of everyone who dares leave
the store with any merchandise, even though the goods are already paid
for.
What’s worse, when I arrived at the CAT two weeks after the storm, no
one informed me how bad things were, because all they were looking for
at that point were warm bodies to help control the dam break of
underwriting errors. Many of the adjusters before me had already fled
the situation.
Little did I know that the underwriting problems had created an
apparently dire legal or political situation, whereby we were told that
the storm office had to be closed by Thanksgiving. This created an extra
element of stress during the operation, that became a nightmare for me
personally. I have a hard time dealing with people who are angry for
good reason. It’s hard to put a value on your labor under those kinds of
circumstances, because you have to spend so much of your time hand
holding. Work like this should be billed at time and expense, or a daily
rate, it’s that simple.
Rumor is that the Mississippi State insurance commissioner has caught
wind of the big mishap, and is coming down hard on State Farm, forcing
them to rush their claims to completion. Keep in mind that you will
probably not be paid for the time and effort you put into the files you
cannot close before they are reassigned. This is common practice with
State Farm, stealing labor, and don’t kid yourself, the adjusting firms
you are working for don’t give a damn about you or your money, because
they will get theirs, regardless.
When I received my files, many of the insured’s were complaining that we
were the third and fourth adjuster who had contacted them. This was only
two weeks into the storm! Why, because it’s getting hard to find good
adjuster’s willing to be a part of the “SF.” They simply don’t pay
enough for the garbage you have to put up with, and it creates
underlying resentment throughout the whole operation. They seem to take
pride in denying people all the they can, and that includes denying the
independent adjuster a fair return on their investment of time and
labor. I swear, working in one of their offices, is often like working
in a maximum security prison. You have no freedom to do anything, except
kiss the guards asses continually, while they strip you of every bit of
pride you ever had in your work. Their arrogance is unequaled in the
industry, and as I have said, I have worked for just about everybody at
one time or another.
My advice. Never ever work for a State Farm catastrophe operation,
unless it’s minor wind or hail, or you get lucky and are working in an
independent’s branch completely separated from their offices. Otherwise,
you will have to put up with 10 times more crap than working for anyone
else, and if you’re lucky, you’ll make even less money.
One of the reasons I’ve always liked adjusting property claims in a
disaster situation, was because I felt like I was helping people.
Working for State Farm, I rarely have that feeling. Instead, I have the
feeling that I’m screwing people, and it’s awful. You go home tired at
night, after spending all day on your inspections, and you think about
all the people you screwed that day, because by the time you get done
with withholding their roof tear-off, and their depreciation, and their
hurricane deductible, they are left with nothing, except a premium
notice that just keeps on coming, year after year. This business has
gone down hill precipitously since I got into it ten years ago, and I’m
seriously thinking of leaving the industry. I just don’t get that good
feeling I used to, especially working for the Great Satan.
Which brings to mind something that just bugs the crap out of me. One of
the worst things State Farm does, in my opinion, is consider partial
roof replacement a betterment. I wish someone would challenge this in
court, again and again if necessary, because if I was sitting on a jury,
I would throw Holy Water all over them on this issue. It’s insane to
call slope replacement a betterment, and we all know it. In the mind of
the average Joe it’s a repair, because in most people’s minds the word
“roof” is singular.
If any independent adjusters are interested in joining me for a possible
class action lawsuit against State Farm, and the temporary employment
agencies they utilize; for unfair and deceptive labor practices, and
whatever else we can come up with, please contact me at my E-mail
address, or watch for future bulletins on this web page.
I have been told that there is a famed attorney who might be willing to
make our case, due to some common interest in another action he’s
undertaken, and which is currently pending against State Farm, by the
policy the holders in the state of Mississippi. Let’s face it, our
testimony could be devastating to State Farm, if we spoke on behalf of
the policy holders in any courtroom in the land. It could be the
greatest bombshell ever to hit the industry, and one well deserved. Much
bigger than the Allstate fury currently brewing in California.
What do we have to lose? Most of us don’t care if we ever work for them
again anyway. If State Farm disappeared tomorrow, most independents
would jump for joy.
”way to re-direct the subject of fraud” Please tell us what you mean by re-direct fraud. Should fraud not be fraud? ‘You’re really Bill Maher, aren’t you’? WOW – guess again. Back to your remarks -‘And way to re-direct the subject of fraud. Believe me, every insurance carrier who’s been proven to have committed illegal acts is taken to task in a big way’. Therein lies the problem. Why is it necessary to spend billions of dollars on millions of attornies to avoid paying claims that even YOU know should have been paid. Ask the thousands of homeowners in the Gulf whether their home was destroyed by wind or “wind blown flooding”. Katrina isn’t the only case for complaint. Wait until the wildfires in California have all worked there way through the legal system. I suppose it will all boil down to all insurance companies claiming lack of responsibility because of arson. My whole point is to get rid of about 90% of the attornies and conduct morals testing on claims adjusters so that payable claims will be honored. Why should you have to spend billions fighting to keep your golden towers. That is just penny wise and pound foolish.
I guess my question is, “Why would people concerned about flood not purchase flood insurance? Would your argument not become immediately moot if they had?” National Geographic even published an article stating that the Gulf Coast has flooded historically and systematically so often that only a low grade moron would continue to re-build and reside there. NATIONAL GEOGRAPHIC!!
Further, as a life-long California resident, I watched while numerous homeowners’ carriers, who had absolutely zero obligation to do so, paid for damages caused by the Northridge earthquake. Yes, carriers including the dreaded State Farm. I tell you this not to change your opinion but to provide facts that you seem unaware of. I also will not obsessively defend every individual who is employed by the insurance industry because I’ve certainly had dealings with more than one bad actor over my tenure. However, the idea that the insurance industry is rife with fraud and serves NO useful purpose is wrong-headed. Further, I can assure you that I, personally, have witnessed insurance companies pay claims when I thought they should not in the interest of goodwill. Seems to me that you should lead the charge in your particular state to create new regulation to tighten the legal structure. However, don’t be surprised when companies retreat because of a “hostile business environment”.
Moving to the beat of their own drum, no matter what! Nobler purposes. How about laying down a challenge? Some live to play the game. I WANT MORE! The goal is not to out manuver me. It’s not what we have, it’s much much more than that. Some seeds will fall on fertile ground and others will not.
— Allstate is the nation’s worst insurance company for consumers, an association of lawyers who sue big business concludes in a report released Wednesday.
“The rankings show a distinct pattern of insurance industry greed amongst 10 companies that refuse to pay just claims, employ hardball tactics against policyholders, reward executives with extravagant salaries, and raise premiums while hoarding excessive profits,” the American Association for Justice concludes.
Researchers spent six months compiling information from court documents, SEC and FBI records, state insurance department investigations and complaints, nationwide news accounts, and testimony of former insurance agents and adjusters.
“We’re not surprised we’re being targeted by the trial and personal injury lawyers because Allstate has been at the forefront of the fight against insurance fraud and the effort to resist unreasonable demands made by lawyers,” Allstate spokesman Michael Siemienas said Wednesday.
“If trial lawyers and personal injury lawyers don’t like Allstate, the facts show that consumers do.”
The AAJ says the U.S. insurance industry collects more than $1 trillion in premiums annually, and has $3.8 trillion in assets, surpassing the Gross Domestic Products of all countries but the United States and Japan.
Robert Hartwig of the industry-sponsored Insurance Information Institute said consumers should consider the source: litigious attorneys who help drive up insurance costs. He also said the industry has paid out nearly $300 billion to tens of millions of policyholders across the country over the past 20 years.
The top 5 offenders on the list:
1. ALLSTATE – CEO, Thomas Wilson; 2007 compensation, $10.7 million; 2007 profits, $4.6 billion; assets: $156.4 billion. “According to investigations and documents Allstate was forced to make public, the company systematically placed profits over its own policyholders… The amount Allstate paid in claims dropped from 79 percent of its premium income in 1996 to just 58 percent 10 years later. In auto claims, payouts dropped from 63 percent to just 47 percent.
2. UNUM – CEO, Thomas Watjen; 2007 compensation, $7.3 million; 2007 profits, $679 million; assets, $52.4 billion. “Unum, one of the nation’s leading disability insurers, has long had a reputation for unfairly denying and delaying claims..”
3. AIG – CEO, Robert Willumstad; 2007 compensation for former CEO, 14.3 million; 2007 profits: $6.2 billion; assets, $1.06 trillion; “AIG executives have also come under fire for opportunistically seeking price increases during catastrophes. Now the company has been labeled ‘the new Enron’ because of charges of multibillion-dollar corporate fraud.”
4. STATE FARM – CEO: Edward B. Rust Jr.; 2007 compensation, $11.7 million; 2007 profits: $5.5 billion; assets, $181.4 billion. “In many cases, the company has gone to extreme lengths to avoid paying claims, including forging signatures on earthquake waivers after the deadly Northridge earthquake, and altering engineering reports regarding damage after Hurricane Katrina.”
5. CONSECO – CEO, C. James Prieur; 2007 compensation: $2.6 million; 2007 profits: $179.9 million; assets: $33.5 billion. “Conseco sells long-term-care policies, typically to the elderly. Unfortunately, Conseco uses the deteriorating health of its policyholders to its advantage because the company knows if it waits long enough to pay out claims, its customers will die.”
Lawyers who subsist on the spoils of suing big business…. Very credible source of information.
Thank God there IS big business for them to suck off of. How else could they ply their wares?
I just love how these professional arguers who steal 30-50% of what should go to their clients, and act like they’re worth it and justify their existence. I wonder how policyholders would feel if I got paid 30-50% of their premium every time I was sitting on the toilet just thinking about their insurance? Sheesh!
justified- because “insurance companies never pay claims” but the truth is that these types of policyholders make the insurance company less likely to believe YOU when a loss occurs. wonder why insurance companies are cautious in their investigation of claims. You might think this is justified . okay I GET IT , IT WAS JUST justified “http://www.clarionledger.com/assets/pdf/D069388410.PDF
”Maybe you should direct your hate toward the perpetrators of fraud’.’ THAT,S WHAT IAM DOING.’We are legally obligated to prove we can meet certain financial responsibilities’. LIKE AIG -..RIGHT. In-a- consumer fraud case State Farm Insurance Company has battled for eight years to keep secret. Why what was the coat of this LITTLE-Secret ?
So again, the question is simple, why with all this agony do you continue to work with State Farm and people continue to buy policies from State Farm? It would seem to me that any company, no matter how large, would go under if they systematically cheated people. And who’s asleep at the wheel where various state insurance commissioners are concerned. Wouldn’t a CAT loss be a DOI’s top priority? Guess not. Hmmmm.
ITS CALLED WINDOW DRESSING/COMMERCIALS. HEY, WE ALL WANT TO BELIEVE IN COMPANIES THAT TELL US HOW GREAT THEY ARE. YOU HAVE PEOPLE WHO HAVE PAID THESE COMPANIES FOR YEARS IN GOOD FAITH. THIS IS A STORY THAT UNFOLDED IN A COURTROOM.
Comment:
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.
Point? You have a point? I suspect you’ve become bored with bashing big oil (since we’ve all figured out speculators are the problem not producers) and now you’ve turned your pathological hatred of all things business to the insurance industry. Don’t you have a Wal-Mart somewhere to shut down? Run along, now.
Give up the fight Brokette. The loons are taking over this site. Can’t argue with nonsense. Anyone still believe there are no professionally paid posters on this site?
State Farm buys ad time during Super Bowl pre-game
By Michelle Koetters
I asked why ANYONE would work for them or buy product from them.
BLOOMINGTON — Tens of millions of people will pay attention to Sunday’s big football game — and maybe even more so to the new, entertaining commercials.
State Farm Insurance Cos., however, hopes to capture the attention of core NFL fans before the New York Giants and the New England Patriots kick off the Super Bowl.
The Bloomington-based insurer will be the exclusive sponsor of a half-hour segment of the pre-game show, said Mark Gibson, assistant vice president for advertising. State Farm also will air several previously-seen ads throughout the pre-game show, Gibson said.
“We’re just excited about our partnership with the NFL,” Gibson said. “The Super Bowl has been an event, obviously, in America.”
State Farm also is the official insurance sponsor of the NFL and sponsors the organization’s all-star Pro Bowl, Gibson said.
The insurance company knows not as many people watch the pre-game show, but many viewers still tune in shortly after they wake up or come home from church, Gibson said. The slot before the game is a great opportunity to reach the biggest football fans and others who attend Super Bowl parties, he said.
The spots before the Super Bowl also are a more cost effective way for the company to get its name out to the public, Gibson said.
This year, the average 30-second television advertisement during the game on Fox is $2.7 million.
State Farm declined to release specific financial information, but Gibson said the company’s total advertising costs for the Super Bowl are significantly cheaper than one commercial during the game.
“It doesn’t even come close to costing what an ad would cost during the Super Bowl,” Gibson said.
Disney/Pixar’s summer film ‘Cars’ features an accident- prone hot rod. State Farm is on board with the picture.
By Theresa Howard, USA TODAY
NEW YORK — State Farm, the largest U.S. auto insurer, today will announce its first movie tie-in: with Disney/Pixar’s summer animated film Cars.
“People have more media choices than ever before, and this is a unique and different way to get our brand out there,” says Mark Gibson, assistant vice president for advertising, who wouldn’t disclose the cost.
The deal with the movie, whose characters are animated vehicles, comes as many insurers in the $450 billion property and casualty industry are spending big to put a more entertaining, accessible spin on promoting their business.
1. ALLSTATE – CEO, Thomas Wilson; 2007 compensation, $10.7 million; 2007 profits, $4.6 billion; assets: $156.4 billion. “According to investigations and documents Allstate was forced to make public, the company systematically placed profits over its own policyholders… The amount Allstate paid in claims dropped from 79 percent of its premium income in 1996 to just 58 percent 10 years later. In auto claims, payouts dropped from 63 percent to just 47 percent.
2. UNUM – CEO, Thomas Watjen; 2007 compensation, $7.3 million; 2007 profits, $679 million; assets, $52.4 billion. “Unum, one of the nation’s leading disability insurers, has long had a reputation for unfairly denying and delaying claims..”
3. AIG – CEO, Robert Willumstad; 2007 compensation for former CEO, 14.3 million; 2007 profits: $6.2 billion; assets, $1.06 trillion; “AIG executives have also come under fire for opportunistically seeking price increases during catastrophes. Now the company has been labeled ‘the new Enron’ because of charges of multibillion-dollar corporate fraud.”
4. STATE FARM – CEO: Edward B. Rust Jr.; 2007 compensation, $11.7 million; 2007 profits: $5.5 billion; assets, $181.4 billion. “In many cases, the company has gone to extreme lengths to avoid paying claims, including forging signatures on earthquake waivers after the deadly Northridge earthquake, and altering engineering reports regarding damage after Hurricane Katrina.”
5. CONSECO – CEO, C. James Prieur; 2007 compensation: $2.6 million; 2007 profits: $179.9 million; assets: $33.5 billion. “Conseco sells long-term-care policies, typically to the elderly. Unfortunately, Conseco uses the deteriorating health of its policyholders to its advantage because the company knows if it waits long enough to pay out claims, its customers will die.”
Here are answers to a bunch of your questions. I’ve been trying to say it but maybe you will listen to an industry giant!
Remember Lee Iacocca, the man who rescued Chrysler Corporation from its death throes? He’s now 82 years old and has a new book, ‘Where Have All The Leaders Gone?’.
Lee Iacocca Says:
‘Am I the only guy in this country who’s fed up with what’s happening? Where the hell is our outrage? We should be screaming bloody murder! We’ve got a gang of clueless bozos steering our ship of state right over a cliff, we’ve got corporate gangsters stealing us blind, and we can’t even clean up after a hurricane much less build a hybrid car. But instead of getting mad, everyone sits around and nods their heads when the politicians say, ‘Stay the course.’
Stay the course? You’ve got to be kidding. This is America, not the damned, ‘Titanic’. I’ll give you a sound bite: ‘Throw all the bums out!’
You might think I’m getting senile, that I’ve gone off my rocker, and maybe I have. But someone has to speak up. I hardly recognize this country anymore.
The most famous business leaders are not the innovators but the guys in handcuffs. While we’re fiddling in Iraq , the Middle East is burning and nobody seems to know what to do. And the press is waving ‘pom-poms’ instead of asking hard questions. That’s not the promise of the ‘America’ my parents and yours traveled across the ocean for. I’ve had enough. How about you?
I’ll go a step further. You can’t call yourself a patriot if you’re not outraged. This is a fight I’m ready and willing to have. The Biggest ‘C’ is Crisis! (Iacocca elaborates on nine C’s of leadership, with crisis being the first.)
Leaders are made, not born. Leadership is forged in times of crisis. It’s easy to sit there with your feet up on the desk and talk theory. Or send someone else’s kids off to war when you’ve never seen a battlefield yourself. It’s another thing to lead when your world comes tumbling down.
On September 11, 2001, we needed a strong leader more than any other time in our history. We needed a steady hand to guide us out of the ashes. A hell of a mess, so here’s where we stand.
We’re immersed in a bloody war with no plan for winning and no plan for leaving.
We’re running the biggest deficit in the history of the country.
We’re losing the manufacturing edge to Asia, while our once-great companies are getting slaughtered by health care costs.
Gas prices are skyrocketing, and nobody in power has a coherent energy policy. Our schools are in trouble.
Our borders are like sieves.
The middle class is being squeezed every which way.
These are times that cry out for leadership.
But when you look around, you’ve got to ask: ‘Where have all the leaders gone?’ Where are the curious, creative communicators? Where are the people of character, courage, conviction, omnipotence, and common sense? I may be a sucker for alliteration, but I think you get the point.
Name me a leader who has a better idea for homeland security than making us take off our shoes in airports and throw away our shampoo?
We’ve spent billions of dollars building a huge new bureaucracy, and all we know how to do is react to things that have already happened.
Name me one leader who emerged from the crisis of Hurricane Katrina. Congress has yet to spend a single day evaluating the response to the hurricane or demanding accountability for the decisions that were made in the crucial hours after the storm.
Everyone’s hunkering down, fingers crossed, hoping it doesn’t happen again. Now, that’s just crazy. Storms happen. Deal with it. Make a plan. Figure out what you’re going to do the next time.
Name me an industry leader who is thinking creatively about how we can restore our competitive edge in manufacturing. Who would have believed that there could ever be a time when ‘The Big Three’ referred to Japanese car companies? How did this happen, and more important, what are we going to do about it?
Name me a government leader who can articulate a plan for paying down the debit, or solving the energy crisis, or managing the health care problem. The silence is deafening. But these are the crises that are eating away at our country and milking the middle class dry.
I have news for the gang in Congress. We didn’t elect you to sit on your asses and do nothing and remain silent while our democracy is being hijacked and our greatness is being replaced with mediocrity. What is everybody so afraid of? That some bonehead on Fox News will call them a name? Give me a break. Why don’t you guys show some spine for a change?
Had Enough? Hey, I’m not trying to be the voice of gloom and doom here. I’m trying to light a fire. I’m speaking out because I have hope – I believe in America. In my lifetime, I’ve had the privilege of living through some of America ‘s greatest moments. I’ve also experienced some of our worst crises: The ‘Great Depression,’ ‘World War II,’ the ‘Korean War,’ the ‘Kennedy Assassination,’ the ‘Vietnam War,’ the 1970’s oil crisis, and the struggles of recent years culminating with 9/11.
If I’ve learned one thing, it’s this: ‘You don’t get anywhere by standing on the sidelines waiting for somebody else to take action. Whether it’s building a better car or building a better future for our children, we all have a role to play. That’s the challenge I’m raising in this book. It’s a “Call to Action” for people who, like me, believe in America’. It’s not too late, but it’s getting pretty close. So let’s shake off the crap and go to work. Let’s tell ’em all we’ve had ‘enough.’
Make your own contribution by sending this to everyone you know and care about. It’s our country, folks, and it’s our future. Our future is at stake!!
I don’t expect to change anyone’s mind (they’d have to HAVE a mind for me to be able to do that–okay, that was hateful) but how refreshing would it be to have them actually answer one of my questions?
I was given this book to read and stopped when I came to the conclusion that it should have been titled, “Why I Hate George W. Bush”. I can get that any night of the week on the network news. To say that Lee Iacocca isn’t the titan of industry that he used to be is a gross understatement. I will give him his due for his past successes but from the tone of the referenced book, he has nothing to offer but a simple rant. And Dennis Miller does it better.
Federal legislation (U.S. Code Title 15, Chapter 20) enacted in 1945 to permit the states to continue regulating the insurance business after the Supreme Court, in U.S. v. South-Eastern Underwriters Association, overruled the decision in Paul v. Virginia, declaring insurance to be interstate commerce and therefore within Congress’s constitutional authority to regulate. Under the Act, insurance is exempt from some federal antitrust statutes to the extent that it is regulated by the states. The exemption primarily applies to gathering data in concert for the purpose of ratemaking. Otherwise, antitrust laws prohibit insurers from boycotting, acting coercively, restraining trade, or violating the Sherman or Clayton Acts.
I certainly rank the lawyers group this represents as the peak of integrity. Is Scruggs the leader? I love how they changed the name to take out any reference to lawyers. You do work for them don’t you?
I gave you too much credit then. You aren’t a mercinary, just ignorant. Try reading something other than Robert Hunter and the Trial Lawyers web sites. There is actual information based on fact out there in the real world, which you and they don’t inhabit. Now, go away ignorant person.
Brokette: He is insulting the actuaries in our profession. If he were really that sophisticated, he wouldn’t be working for minimum wage catering to clients who cannot pay their bills or manage their lives. Anyone could work with those clients, but the very best brokers work with clients who have it upstairs. It’s amazing, you have a guy with no actuarial experience pretending he knows more than them.
That the article would cite race as an issue when insurance companies KNOW they’d be burnt at the stake if they even tried to racially profile their insureds. Leave it to Reuters to mention something other than legitimate loss data to characterize what insurers do. I feel the nationalization of our industry around the corner. After all, it’s working so well for banks and automakers.
The Government is on to me!
The Hen House Security Association, of which I am the shadow President, is at risk of being disbanded!
…here comes the judge, here comes the judge.
I have yet to be shown stats that support the industry position that low credit scores equate to higher auto or homeowner claims. I suppose the Government is concerned about a lack of hard evidence as well.
During this time of financial crisis, with the credit card companies and banks running credit scores into the ground as a means of justifying the increasing interest rates on those “higher risk” accounts, the insurance industry needs to back away from skewed data.
Ah, I just realized…skewed data. That has been and continues to be the basis of underwriting and rate making decisions for all lines of coverage.
What a sham.
Think about where the elimination of ‘redlining’ back in the 70s got us to today! Subprime; Short Sale; Foreclosure; bank failures! Better keep using those credit scores!!
American Family has a well-established history of documented racism in its practices. Here we go again. Credit scoring has been a BOON to companies looking to avoid insuring other-than-white people. Hope they don’t survive THIS review.
It’s amazing that NOW the FTC is concerned about credit score rating-where have they been for the last few years. This isn’t exactly a new issue. Agents, Brokers and Insureds alike have not been able to figure out how the credit based rating works and have been frustrated by the process. It appears to be another sign that we have gotten away from the fundamentals-underwrite the risk properly and more often than not your bottom line will be fine. Isn’t that how the top carriers got that way in the first place? So, where did all the underwriters go anyway-are they endangered….It sure does look that way. This should be a giant wakeup call, if we as an industry can’t properly regulate ourselves and stick to what we do best, someone else will do it for us. We just have to look back to the early 1940’s; McCarrin-Ferguson Act paved the way for the FTC to do its thing now. Someone once said, “we who forget our history are doomed to repeat it.” It should be one hell of a show.
There have been numerous studies done on the link between low credit scores and higher loss ratios. This strong correlation has been proven even in university studies. The question remains however if the low credit scores fall unevenly among certain races? If there are more blacks or latinos with poor credit scores is this a backdoor approach to unfairly discriminating among certain ethic groups? If so, should we ban the use of credit in underwriting? I firmly believe insurance companies are NOT trying to discriminate based on race. These carriers simply want to charge a more appropriate premium to those with lower credit scores.
Where have you been? The statistics have been available for everyone to see for many years.
So some feel the people that live responsible must have their premiums increased to reduce the irresponsible’s. Since the 1960’s declared War on Poverty this government transferred trillions of dollars to the irresponsible and what did it get us? No thanks are heard from the irresponsible, only a demand for more.
Ok,
Come Jan 20th, I will declare that all minorities and middle class people do not have to pay for insurance anymore. They can get it for free. We will just start charging the rich people more for their insurance. How else can I keep my power base unless they are completely dependent on me. Yes, my version of modern day slavery.
Are you kidding me? If you can’t find the evidence then you haven’t been looking. Google search:
1. Epic Report
2. Texas Credit Study – TDI
3. Texas Study – Bureau of Business Research
4. Maryland Insurance Administration study on credit
5. FTC study on credit scoring for automobile insurance
Reasonable people could disgree that the factors that lead to a correlation between credit score and loss history may be redundant to other sources, or that use of scoring results in a disparate impact on certain classes, but it is simply ignorant to argue either that the correlation doesn’t exist or that scoring is used for ethnic purposes (insurers don’t collect racial information and have no idea the applicants background).
Anyone in the industry that has not looked at the statistical significance of credit scoring and not agreeded that it should be part of the underwriting equation is extemely lazy or uninformed. The industry will not have any problem with the investigation at all. The public does not like the fact that certain minority groups seem to have higher rates because of this statistical fact, but all those carriers will survive this just fine. THe up side is perhaps it will bring to our public another lesson similar to the mortgage crisis, save and live within your means.
Your post is illogical. Charging racism is a worn out statement and an excuse for someones failure. The insurance companies and their agents are in this business to make money. Why in the world would we care what color someones skin is? I would recommend you grow up.
Amen to Pat and Ned… I’m glad that someone “GETS IT”!! Like was said earlier, this is not a new topic. Just like what happened before, the insurors will be fine. This is not unfair or racially motivated(that is so tiresome). Everyone has a choice of how to spend their money and affect their credit. If you have issue with that, it’s not with your insurance carrier. Look in the mirror.
I understand the concept, yet, after 10+ years I am not convinced that most of my clients with low scores have any worse of better claims experience. It causes them to seek insurance in much more expensive markets, such as FAIR Plan or E&S Lines, which is a financial burden, harder to place and makes our industry look bad. What happens when the loss of jobs due to layoffs from the irresponsible finacial giants starts to affect credit scores of the once otherwise credit worthy elite? If insurance companies did credit scores on their own rank and file (worker bees) who work paycheck to paycheck, maybe they would be a little kinder and less cold calculating. Credit scoring has been the success for marketers of the various services, and the insurance companies, like pigs in a the herd simply follow one another in this stupid practice. Merry Christmas to all !!!!
Under his wealth allocation plan all the people with the good credit can pay a good credit tax. Then we take the good credit tax and give it to the people with the bad credit. Then everybody gets equal rates. Hope and Change is coming in less than a month to all.
Oh My God!!!
You called Glennie. What can I do for you.
I am sorry if I sound racist. That is quite funny considering my lineage. You are correct, insurance is about protecting assests by spreading risk and making $ in a manner that is built on statistical analysis and science. The industry has its bad eggs (like every business/profession) but the majority of us in it are not racist or un professional.
Why bother to quote studies and facts? John Q and others don’t care about facts, just how awful the practice is to some named group. My company has numbers outside any study that back up the insurance scoring we use. That’s why the various insurance departments have accepted our methdology. But again, why bother when posters like John Q don’t care about facts, just their own feelings. Perhaps a change in industry to one you could feel good about would be in order.
In Texas if Whitey has poop credit he gets poop rate. The numbers prove that credit rating works. If Obama has good credit he will get A#1 Whitey rate. What’s the problem? Black, Brown, Dot Coms with good credit all get same as A#1 Whitey rate. If you let your cars go back and have been kicked out of a couple of sub prime loan houses your loss potential is proven higher.
FYI – I don’t know an insurance company who doesn’t check employees credit (pre-hire). I knew several of the hiring managers and still had my credit, criminal record, education and emplyment histories checked. There is a connection between how you manage your money and how responsible you are – even at work.
Also, just so you know, as the bankruptcies have increased of late so have our fire losses. Who knows if it’s arson or depending on candles for light, but the loss experience has suddenly and dramitically increased in hard hit areas.
Folks, On January 20, 2009, when we become the United Socialists of America, it won’t matter. Our Congress will appoint an insurance czar to promulgate rates, being sure to apportion some to the federal coffers and create a new bureaucracy.
Remember Winston Smith
“… Two gin-scented tears trickled down the sides of his nose. But it was all right, everything was all right, the struggle was finished. He had won the victory over himself. He loved Big Brother.”
I hope that all who think we are going the socialist route will decline Social Security and Medicare when they qualify (unemployment too!). I’m sure they wouldn’t want to participate in the redistribution of wealth!
I have been in the insurance industry since long before credit scores. I have a couple of observations:
my small company has proven there is not a correlation betwen credit scores and homeowners claims. however, if you have someone with a low score, they can’t come up with their deductible, they can’t maintain their premises very well, and they let their insurance lapse. lapses are overlooked at one of the significant expenses insurance companies face; a non pay customer is much more expensive to maintain than a good pay customer
and finally, and most importantly, how do you know you are discriminating on the basis of race, when NOBODY has a question on their application as to what race the applicant is??????
I paid into, and still do pay into, Social Security and Medicare and you can bet your sweet bippie, I’ll collect them – unless, of course, I can get one of those lucrative pensions that Congress gets! If “Pro” is the opposite of “CON”, is that why Progress is the opposite of Congress??
Does Wind, Hail or tornado’s only hit poor people?
If it’s a good credit tax then wouldn’t it be a bad credit credit? You would being taking away from all the bad people with good credit and giving credit to all the good people with the bad credit. Sounds like hope and change be a coming!
Regardless of color. crede, gender, Kick a man when he is down is just wrong espically in these trying economic times.
Just wrong.
What planet are you on? No supporting data?
You’re that unread on this issue?
So, let me see if I understand this correctly. If my credit score is low, but I have NEVER filed an insurance claim, I have to pay higher rates because I am a higher risk? Call me ignorant, but that doesn’t make any sense at all. I could see it if I had a low credit score with a long claim history, but even then I would think my claim history would be the best indicator of whether or not I would be likely to file a claim.
I would like to see the government prove the industry wrong. So many seperate companies have acquired adequate data to demonstrate the importance of using the scores in pricing that it seems ridiculous to question it.
I think if the government thinks they can do well with their own rating plan they should start their own company. Perhaps focusing on risks with low scores, specific races, no fire protection, pit bull terriers, or any other cockamamie niche they have that they feel we overprice. However, I would say they cannot have an unfair advantage. Specifically, no use of taxpayer funds. They need to find private capital like everyone else, or issue a assessable policy.
Level the playing field and lets see who knows better how to match rates to expected expenses.
I’ve have been in the business on the agency side long before credit scoring (50+). The many companies I represented had proven to me there is a correlation between credit scores and losses.
You mean like when the state of NJ sold auto insurance? ROTFLMAO!!!
They made the mob look great!
I don’t know about any of you, but when I quote someone I DO NOT ask what their race is. Let’s get real.
For all the posts I just read, I was surprised how many were actually in favor of credit scoring and believe in its viability as a valid underwriting tool.
The studies all seem to indicate that there is a strong correlation between credit scores and loss potential.
Now, for those who say “I have a low credit score and I have never had a loss”. Too bad – haven’t you heard of the “law of large numbers”? Just because you have had no losses has absolutely nothing to do with the total statistics supporting the credit rating/underwriting relationship.
Let us hope that the Feds don’t get their hands on the insurance industry. Look at flood insurance rates – there is no doubt that the loss ratios for National Flood would drive a regular insurance company into the ground. Companies need to make profit! The Feds would create rates that wouldn’t cover the losses – and then wonder what happened. The proof is highly visible every day on the stock ticker and the reports of bankruptcies, etc.
Geet Uncle Sam out of private business…
You want a government run insurance program look no further than their FLOOD PROGRAM that is 17 billion in debt. A few of these companies that they are reviewing are actually taking up the baton to try and find a way to write flood either by endorsement/policy to figure a way to fix that program. The problem is that the government will want oversite! They ran their progam so poorly, but they want to oversee someone else?
As mentioned, credit has plenty of statitical backing, nobody asks the race, religion etc questions.. Always remember, Insurance IS discriminatory.. is just has to be FAIRLY discriminatory! That is why a 16yr old, single, male driver is more expensive than a 35yr old, married, female driver…
I guess if the insurance company would know in advance you would never have a loss during your lifetime they would develop a special rate for your type. But the fact is that you do not know what your record will be prior to death.
If all insurance policyholders had losses there would be no insurance, as insurance collects premiums from the majority to pay losses of the few.
No matter how you want to argue this, facts will prove that credit scores are an accurate factor in predicting losses.
I agree with scoring, but why not use the actual credit score and not the “insurance score-made up model” by each company which is different for every company. A Score that is good for one company is not so good for another company. Doesn’t make sense to me.
You seem to have missed a couple of points in the story.
1 – The government wants to see particular client loss experience – randomly picked by the government for review. That seems to indicate that, somewhere in the bowels of the bureaucracy, there appears a conscientious analysist who has finally found the climate wherein politically influenced micromanagement of the regulatory process can be ignored — look where special interest legislation has brought us thus far.
2 – The current credit scores are skewed. A majority of Americans do not save and are, on average, carrying $10K-15K in credit card debt. That would suggest that these Americans have, or should have, lower credit scores. Does that mean that they will now drive carelessly or that they will stop maintaining their homes? Well, they may not have the money to properly maintain their homes, but that does not mean a higher morale or moral risk is evidenced for this group.
3 – Please cite the stats you refer to.
Rick, will you please explain how there can be creditable evidence when it takes a careful study of large numbers and a lengthy amount of time to prove the position that lower credit scores equate to higher claims frequency? The industry simply hasn’t been using credit scores for a sufficient amount of time. But, what do I know? That’s why I’m asking you to please enlighten me.
The stats and scores do tend to play against the poor. Oh, wait, that may be the financial position of many in this country. So, then there will be an outcry against credit based rating?
It’s ok to use credit scores to promulgate rates, just as long as it doesn’t affect your rate, eh?
George,
Please cite the studies.
Thanks!
Thanks, Pat.
Time to do a bit of studying.
Why is everything about race? This is about finances. I am oppose to credit scoring not for any reason other than it makes those without income pay more for a government mandated coverage (auto).
Everyone get over it! We have a black president now!
That is the most moronic post I’ve read yet.
Did you vote for Obama?
Do you hug trees?
Hooray. Maybe finally these insurers will have to explain and demonstrate how their hocus – pocus use of crdit scores has legitimate relativety to people’s driving ability or propensity to cause auto accidents.
The FTC should also investigate the Fair Isaacs company and have them justify the ‘black box’ for their creation of the infamous FICO score. I’m quite sure they will find that their ‘black box’ is based on a myriad of false assumptions or assumptions that are rooted in prejudice.
Given that the use of FICO scores are almost universal in our life, the time is long over do for a true public invesigation of how exaclty this ‘black box’ was constructed. Just as a simple example: today many lenders are unilaterally reducing credit lines. This would then result in a lower FICO score for the borrower because the debt relative to the avaialble credit line has increased. In this instance, the change in ratio had nothing to do with the borrower yet the FICO score goes down. Obviously, this is just one exmple of where the FICO ‘black box’ needs fixing.
Staffman,
good comments on Flood, it is incompetently managed. Moreover, anyone can acquire business when offering inadequate rates backed up with taxpayer subsidies.
I want to see the government prove us wrong, by using their own pricing methods without the backstop of taxpayer funds.
LOL – obviously.
But, to simply state that there are studies galore, without citation, leaves one wondering.
Please don’t be so smug in your superior stance. Not everyone in the industry has time to read these studies. Many on the production side of the business have these new rating models shoved down our throats without explanation or reference to specific studies.
Pat has given me specific studies. I’ll save further comment until I’ve had a chance to do a bit of reading.
I would love to forgo my Social Security, Unemployment Comp. Just let me not pay it in for your sorry A*s.
We did not go into a depression in 1929 not until 1932 when Hoover raised taxes and raised tariffs. What is Obama proposing?
Which “real” credit score? Equifax, TransUnion, or Experian?
Also, those scores contain information that insurers are not permitted to use, like actual balances and income.
The insurance scores are arranged so as to get the best predictive value for that insurer. Most smaller companies use an off-the-shelf model anyway. If you get a quote you don’t like, shop around.
I agree with most of your position except that the law of large numbers is supose to include everyone. Reducing the numbers by credit scores hurts those with limited finances and helps those with good finances. I believe it does not spread risk to everyone. It actually works against the laws of large numbers in my opinion. You make good points though.
If you want a summary go to the Insurance Information Institute web site, click on Issues, Credit Scoring and you will see a well-written white paper and several presentations that support the correlation.
And, before you complain that these are biased viewpoints, remember that several of the studies were commissioned specifically to prove that credit was not correlated to loss history and was inherently unfair, yet they concluded just the opposite.
Again, I believe reasonable people could debate redundancy and disparate impact, but not the existence of correlation or willful unfair discrimination.
I’ll attempt to answer your questions in a condensed manner.
#1. Why should the government get involved with its many paper pushing bureaucrats when the market will do the work for them, and more efficient. There are hundreds of companies competiting for business. If one thinks his/her quote/premium is too high then shop around.
#2. Credit scoring has nothing to do with rich or poor. It is about responsible living. Those that manage their finances in a responsible manner also manage life that way. Those that have 10k to 15k credit card balances are living beyond their means, are certainly not managing finaces in a proper way and usually have lower credit scores. You might not realize this but there are many rich people that have low credit scores.
#3. “Please cite the stats you refer to” Why should I? You can eaisly find this information for yourself.
Regarding your last comment. Credit scores began circa 18 years ago in 1990.
Again, credit scores do not play against the poor. It is how one manages his life style. There are both rich and poor with high and low credit scores.
WHY STOP AT SOCIALIZED HEALTH CARE?
WATCH FOR SOCIALIZED AUTO & FIRE INSURANCE AFTER JANUARY 2009!
NEXT WILL BE SOCIALIZED SOCIALIZING.
A perfect example of Government helping Government by giving them something to do. If the members of Congress feel there is a void in companies’ credit modeling, why don’t they join forces to start their own private company which should be profitable?
This is Ironic in a sense that hard-working, tax paying citizens are paying Members of Congress and the FTC to figure out how to spend the hard-working, tax paying, honest people’s money to assist the NON-tax paying, unemployed, and dishonest.
Sounds Good. Maybe we will have Socialized Lunches and Socialized bathroom breaks.
My credit score is better than Dale Jr’s so does that mean I will crash less??
Well said George! It really is simple: insurers do not ask your race when quoting so someone thinks that they are replacing low credit scores for race. But there are LOTS of “other-than-colored” people who have low credit scores. If credit scoring is a backdoor approach to applying race to the underwriting and there is an admitted problem where low scores would also apply to whites, then it would seem that using credits scores would skew the data in the other direction; if that were so do you think companies would continue to use credit scores at all?
Sam, how have you proven no correlation? That is counter to every study I have seen.
Don’t blame Obama for your mistakes! You voted for BUSH! Your Republican party voted for SOCIALIZING AIG AND THE AUTO MAKERS. Wake up and think before you write anything against something you don’t know.
One interesting thing to consider. From everything ive read over the years, no one has ever told me what the average insurance score is for a person who makes 20 grand as opposed to a person who makes 100 grand.
Im not saying credit scores cant predict claims, but we should at least be able to determine if poor people have to pay more for insurance because of credit scoring.
People say the credit score is about personal choices and responsibility, but if the average credit score for some one making 100,000 is higher than the person making 20,000, then it goes to show that insurance scoring discriminates against the poor.
And who knows, maybe you think that’s ok, but at this point we don’t have all the facts.
So tell me why throughout all these discussions no one besides me has ever even asked the question: Do people who make more money have better insurance scores? Show me the exact numbers.
I believe poor people often have lower credit scores because instead of choosing to be responsible and buy a Ford instead of a Volvo, or buy a 50 inch plasma instead of a 60 inch, poor people have to make credit decisions that have to do with whether or not their kids get school cloths, or a modest gift for Christmas.
Its harder to be fiscally responsible when you don’t have enough money for the basics. Its just pure and simple logic.
Try balancing a poor mans budget as compared to a rich guy, conceptually, both can have great credit scores, but we all know in the real world it just doesn’t work that way.
As far as race goes, what is the average credit score of a black person as compared to a white? Its a simple little question that could help us get to the bottom of this mess.
But over and over and over, we just don’t ever see the answer mentioned anywhere.
—– Original Message —–
Jack, I doubt if it will happen; there is just too much else to do so that adding the burden of another federal bureaucracy does not loom large on the horizon; the industry will fight back with a campaign to educate the public and public advocates. It comes down to public inertia; it will take a lot of money to get anything new off the ground and as scare as new money is now, old money sure isn’t available. the new administration is up to its ears with other problems. I doubt if Kanjorski has the muscle, let alone the support to get anything up and running within four years….
You might want to check the Congressional voting record before you blame the Republicans, hon. A Republican President with a Democrat Congress is what we have now. Believe me, WE’LL be blaming the Dems here after Jan. 20th because they’ll have control of both houses of Congress and the Presidency. Let’s see you absolve your party then. hahahahahahaha
Great post Ralph!
It sound to me like they are hiding something. Give us all the information we need to make an intelligent decision.
Then it just comes down to the moral question, is it ok in American to kick the poor when they are down?
We already have a proven model, National Flood Insurance. It is surely FAIR, no one can complain about being discrminated against, for whatever reason; and we can also attest to the result: underfunded, underreserved, slow to pay, etc. Imagine how the government “insurance” would work, the first claimants in, get paid until the money runs out and we wait another year for another appropriation or another bail out.
Thanks, Rick.
I am in the process of reading the Epic Report; the Texas Credit Study-TDI; the Texas Study – Bureau of Business Research; Maryland Insurance Administration study on credit; and, the FTC study on credit scoring for automobile insurance.
Thanks to Pat Beranger for the citations.
I suppose I would be one who would argue that underwriters should be involved in the review and rating of these issues, but I suppose that would be too costly for the carriers these days.
The pricing of home and auto coverage does not seem to take into account the particular circumstances of a given prospect. Current rating is computer generated and, for the most part, bypasses underwriting. What about the client who has filed for bankruptcy due to catastrophic medical costs? How about the drug dealing insurance carrier VP, or drug snorting attorney/physician/politician that is flush with cash and sports a stellar credit score? Where is the fairness in the rating? This has the appearance of falling dangerously close to a class-based rating scheme. I have clients who only graduated from high school, have minimum wage jobs, and low credit scores, yet they pay their premium on time and have never filed a claim. I have clients who are college educated professionals, seem to understand how to work the system, have high incomes and credit scores, are slow to pay premium, file multiple claims, and then are cancelled because of claim frequency. Which profile is the better risk for the carrier?
I believe you will begin to hear from incensed clients who are being handed increased premium due to wholesale lowering of credit scores by the reporting agencies. Yes, these clients should have managed their financial lives a bit more responsibly, but they are trying to rid themselves of debt and should not be penalized while they are responsibly attempting to turn their financial lives around.
Give us a break and get back to claims-based underwriting and rating.
BEING POOR DOES NOT GIVE YOU A BAD INSURANCE SCORE, NOT PAYING WHAT YOU OWE AND HAVING CLAIMS DOES. I KNOW A LOT OF POOR PEOPLE WITH PERFECT CREDIT.
Why would it make a difference if higher incomes did have higher scores.
The insurance industry is trying to match a price to the expected cost of a risk.
We really don’t give a rats behind about actual personal choices or how difficult they may be for a particular household. We simply want to insure EACH household against insurable loss exposures at a price that is both market competitive and allows the insurer to make a reasonable return on our investment.
Were not the government. We don’t intend to spread wealth, we simply protect what you have.
Thats nice joe, refer to Rachel’s post.
Let me get this straight, ive got a poor insurance score, so therefore you wont hire me, rent me a place to live, let me get a cell phone, let me get the heat turned on, or let me get insurance?
Hmm, something doesn’t smell right here.
Can I get some compassion?
OH WE WELL GIVE YOU ALL OF THAT, YOU WILL JUST PAY A LITTLE MORE BECAUSE YOU HAVE A HABIT OF NOT PAYING YOUR BILLS.
I have a question for you–Why is the presumption that low income people automatically have bad credit? Is that because you believe everyone is entitled to shop at Neiman’s when they can only afford Target?
Something forgotten in this old rich vs. poor debate seems to be that someone somewhere had to work very hard to earn and acquire that wealth. Further, being rich does not automatically equate to managing money well. There are plenty of “rich” people living beyond their means. Irresponsibility knows no monetary bounds.
AMEN
Good God, Jake! You make our system sound completely devoid of any opportunity. How the heck does anyone in our society graduate from school, get a job, place to live and insurance? It happens everyday. The sky isn’t falling, Chicken Little.
… in that they always seem to seek their own level. I believe companies were looking for the tool(s) which was(were) best at predicting losses at the best(or more appropriately “competive”) price. It allowed them to let incoming apps “flow through” with little or no underwriter touches, thus reducing costs. I believe that is why you are now seeing a constant tweaking to the models as companies receive and compile their own statistics. It certainly has improved profitabliity and has also kept the premiums lower for most, however it has raised prices on some. For those agaisnt credit scoring (and I was strongly opposed when it first arrived, but have since softened my stance) let me ask this.
1) What about zip codes, are they not more discriminatory?
2) What about sex, is it not sexist to charge a 16 year old male double that of a female?
3) What about age discrimination?
4) What about married vs single?
You people are asking for compassion, but an insurance company is not a charity organization. The only sustainable alternative to charging higher rates to those with lower credit scores is to not sell them insurance at all. Is this the solution you prefer?
I don’t think this is a Rep vs Dem argument..this is Big vs Small Gov. Eventually majority of the population from both sides will say enough is enough.
Oh, no. We prefer the compassion that says, “Take from the dirty nasty rich people who didn’t do a darn thing to earn what they have and give it to the poor people who haven’t earned a thing but they work every day at horrible dead-end jobs and zero choices in life.”
Have I ’bout got that right, Rachel?
Since you are so full of yourself, (you too CHELI) –
Lets make a bet – Ill bet you 1,000, that the average credit score for someone making 100 grand is higher than that of someone making 20 grand.
Would you take that bet? I know there are exceptions to the rule, but would you take that bet?
Come on, show me how stupid you really are.
So here is an idea, lets pass on more of the cost of insurance to the people who have the claims. Sounds good right?
So if you have a bad credit score and have a claim, YOU PAY AN AUTOMATIC $5,000 deductible.
If you have good credit and no claims, we will refund up to 50% of your yearly premiums, its only fair right?
Rachel,
Even the Salvation Army stops giving if the revenue does not come in.
Insurers must stop insuring if the price is inadequate. So I don’t know if being poor = low insurance score, nor can I care. I must price in a manner that is reasonable.
I SELL INSURANCE. I RUN SCORES ALL DAY EVERY DAY! BELIEVE ME,THERE ARE A LOT OF POOR FOLKS THAT PAY ON TIME EVERY MONTH,AND THERE ARE A LOT OF WEALTHY CLIENTS LATE EVERY MONTH AND THE RICHER THEY ARE,THE MORE LIKELY THEY ARE TO FILE A PETTY CLAIM.
What your point Cheli, that’s called anecdotal evidence, it doesn’t mean a hill of beans.
I want facts.
Life is not perfect and neither is credit scoring, however credit scoring is a very good & fair tool in setting price for risk.
You used extreme examples in your argument, “bankruptcy due to catastrophic medical cost” “pill pushing VP etc”. I could retort that the bankruptcy was poor financial management due to not having oneself properly insured; and don’t come back with the response that health insurance was not available as group health is 35% of my agencies revenue & I know its available. Regarding your other example of the drug dealing vp etc etc, those type probably do have lower credit scores as their life style will be reflected in the way they manage finances.
You still seem to be stuck on this high income & low income – rich and poor stuff. CREDIT SCORING IS ABOUT MANAGING ONES LIFE WITH WHAT ONE HAS! Not how much he has or how much he or she makes.
Underwriters are still involved in the process in combination with credit scoring.
If I’m contacted, as you suggest, by incensed clients due to lowering of credit scores, I’m confident I can explain in a way they will understand.
We find that people that eat red meat have less claims than vegans.
Ah, the old tried and true name calling. I don’t have to bet with you. I’ve been poor and had to manage fewer resources than you’ll ever know. But I got an education and worked my buns off and made something of myself. I don’t know how I did it in a male-dominated profession without a union, but I did. So don’t tell ME the system is unfair and poor people can’t get ahead. And truthfully, credit scoring isn’t the ONLY criteria used for premium calculation. When we start applying social issues to business models, we’ll have huge business failures. It just doesn’t work. I’m sorry about that but business isn’t welfare. Maybe a woman with a little self-confidence isn’t your cup of tea but calling her stupid isn’t the answer.
RICK, CAN YOU EXPLAIN THAT TO DOUG IN VERY SIMPLE TERMS ? HE JUST ISNT GETTING IT
That is discriminatory to the poor because you know that there must be a strong correlation between vegan diet and poverty.
We need to have the FTC regulate insurers so that they can no longer discriminate against vegans.
It should not matter if meat eaters are much less expensive to insure.
CHELI, there are those that cannot grasp the concept and those that are too obstinate to admit they got it. This simple concept of credit scoring is one of those that I’m sure they get it, its just that they don’t want to admit it.
Brook, so you arent going to take my bet then are you?
If you are right then you should take the bet.
Its funny cuz I never said I gave a dam about poor people paying more – Let them starve, I really dont care, just dont lie about it and say they have the same opportunity as the rich guy, cuz thats a not true.
Well, joe, to play devils advocate – if you truly want to match price to risk, I mean, truly match price to risk, not just halfway matching, but completely matching, you would need to have each individual pay for their own losses.
That would be the “fairest” way of all. That would ultimately match the price to the risk. Correct? What? Well, I’m right, right?
Oh yeah …there is a small problem with being that fair. That would cut out the need for insurance – the spreading of risk.
The industry needs to be careful of how far they want to take the “matching price to risk” theory. If it gets to close to the fairest method, they will be out of an industry, and the increasingly socialistic government will step in to save the people.
Or, so it seems to me.
More like insurance genius. Very very intelligent well thought out post my friend.
Abe, I was born dirt poor. I worked my butt off for 50 years and now I’m one of those evil rich guys. I paid my share of double and triple taxation and when I die old Uncle Sam will lop off 50% of what I want to go to my kids to give to your ilk. So I don’t like to read about the poor person that just can’t get ahead because of those rich guys. That’s just an excuse for failure and attitudes like you have will guarantee that failure.
The insurance concept of matching price to risk assumes the price is established before the risk is underwritten. The whole concept of insurance is we are using information to predict the level of risk. Ideally we use the best information available, whether that is credit, fire protection, building code enforcement, etc, etc. We never would want to ignore a very predictive piece of information.
As an agent, you know that very well. We are not in the business of bidding on individual know losses.
I don’t argue with parakeets. I get it, poor people are victims and they never did anything to get themselves in their current situation. And they’ll never dig out no matter how hard they try so don’t even try. Must be comforting to see poor people and believe that THERE’S someone you can feel you’re better than. Keep on believing that tripe.
Next month we are going to get rid of the Republican control in Washington. All new White House, Senate, and House of Representatives. No more Republican control for any of the 3. All Democratic with the leader Obama cracking the whip. Just wait for no more $4.00 gasoline, free health insurance, no more foreclosures, and no more credit scoring.
Have we so soon forgotten the relationship the drug companies have with the FDA?
Are you folks really suggesting to me that these credit scoring studies and the funding for these studies were completely free from industry involvement, and, that the insurance industry has no influence with the FTC?
LOL! By the way, which is your favorite – grape or cherry Kool Aid?
Heres a hypothetical – What if I showed you that Black people have more claims than any other race.
Should we use this info to charge them more?
You people seem to want to avoid any moral issues as far as how society deals with race, and socioeconomic issues.
Of course that shouldnt be a surprise, Republicans aren’t really into liberal arts like sociology any way.
I am certain that the insurance industry did fund some of the studies.
But suppose they are purposely flawed. How would the industry benefit from that? They would be charging low rates to people with high expense levels. And they would be charging high rates to persons with low expense levels. All of the latter group would move to the carriers that did not use credit scoring in their pricing.
Seems illogical, some that the government might do, but not private industry.
This article may have taken top response honors away from AIG. It’s about time we found something else to kick into the dirt.
Ha!
Some of you people could not posibly work in the insurance industry. Insurance scores are probably the best predictor of future loss that there has ever been. They have nothing to do with wealth or race. They judge responsibility. I have poor clients of all races with very high insurance scores and wealthy clients with low scores. So some of you are saying that insurance scores are no fair because blacks are inherently inresponsible. How racist is that? If you think that you are racist.
Ins Man – Read the prior posts, you are out of it. Your experience is anecdotal evidence, not fact. They have not given us the information we really need. Would you take the bet that was spoken of?
Poor people probably do have worse scores when viewed as a group – And it can be statistically proven that more black people are in poverty than whites on a per capita rate.
So are statistics racist now??
Insurance Man, I think what you see here is an example of conservative v liberal and right v left.
No Statistics are not racist, just people who use unbiased data to paint a whole race of people as irresponsible. I am not going to do your research for you. Look it up yourself. I’ll bet you will not beleive it anyway. Thats the bet I will take.
I agree with insurance man,
Insurance scores are the most predictive variable the industry has available. Hands down.
Regardless of whether somebody is able to prove a certain demographic, social or racial group has better or worse scores than another, not using the score takes science out of insurance. It becomes charity and subsidy, not the business of insurance.
Let the government handle charity, subsidy, redistribution of wealth, etc. Let the insruance industry insure people.
So why are the insurance companies hiding the data??
What is the average score of a person who makes 100 grand?
Why is this number imposible to find?
Rick,
I think it is Right and Left VS the far, far, far, far left. “Kool aid consumers” I am a little left of center. Voted for Barack.
I also believe in insurance scoring. I believe in a prudent, statistically sound insurance industry. I don’t believe that the industry shouldn’t be responsible to correct all injustices in the nation. I don’t believe the industry should ignore good indicators.
This discussion could easily be likened to a consumer product with a warranty. A car perhaps. If one model was designed perfectly and never broke down, only a crazy person would expect to pay the same amount for it as for a similar model that was hastily designed and has statistically significant track record of breaking down. Price them differently and the people way out in the cheap seats of left field say that Reliable Car Company is discriminating against “XYZ” group.
if the credit scoring formula were standardized it would resolve a lot of problems. currently carriers pick and choose the criteria they want scored to develope the market they want. i know a major company that will produce a different score for the same insured depending on which agent enters the information. currently the scoring system includes some bias on the part of the carriers. by standardizing how the score is developed everyone including the clients would be on the same playing field. this can be done without federal intervention if the insurance industry would agree on a standard formula in developing everyones score.
Because then they’d be dirty rotten scoundrels for releasing our private information–if only hypothetically. Here’s an idea, become a $100k wage-earner and then you can find out.
There is nothing wrong with a company customizing things to get the business they want, I think the better agencies out there also do their own target marketing.
It’s also time for the government to stop insulting Hispanics and African-Americans as being people who are not capable of being responsible and not being able to achieve top scores, this kind of racism is of the worst kind.
Science?
LOL – scientists are known to skew the facts to fit the desired outcome – as some of the posts alluding to scoring services twisting scores into the mold set by carriers to provide preferred rating to a particular segiment of the marketplace.
Science? Please.
This is simply another form of “redlining”. Who do you Kool Aid drinkers think you’re kidding?
“Once the paper cab told the orange eyebrow to wiggle up the day.”
1) I have read some of the “studies” and maintain they are junk science. Why ? Real scientific research starts with a random selection of people and follows them for 10, 15, or 20 years gathering all sorts of data. Once the data is collected, it is examined by competent, unbiased experts. THEN the correlations are made because the evidence (facts) yields (will support) the correlations.
2) The “studies” were just that. Someone took 5000 claims and looked for a common thread. That is not “research”.
3) When you do real research, you do not start with a premise and set out to prove or disprove it. It appears to me that all these “studies” started with a premise and took “snapshots” of current data. They then made assumptions and have used data from the snapshots to prove their assumptions.
3) I demand proof that any of these “studies” were conducted as “real research” by asking the following:
a) how many subjects were selected at random ?
b) how long was the data collected? 10 years? 15 years? 20 years?
4) Well, all of you “look at the facts” experts, answer a, b
What are your credetials DarNovak? Typical liberal who dreams things up in your brain and then think it’s reality?
Nevertheless, I will give you a chance to respond.
Also, why do you think you are better than the free enterprise system. If poor credit clients are such great clients, why don’t insurance companies target these people? Why don’t you start you own insurance company? By your logic, you would make a killing. Again, I will wait for your response, don’t be shy.
Warning: I use my real name, not some cutesy sock-puppet name. I am in my 38th year of working in the P&C industry. The following is my opinion and I welcome thoughtful, intelligent discussion.
1) I have read some of the “studies” and maintain they are junk science. Why ? Real scientific research starts with a random selection of people and follows them for 10, 15, or 20 years gathering all sorts of data. Once the data is collected, it is examined by competent, unbiased experts. THEN the correlations are made because the evidence/data yields (and will support) the correlations.
2) In my opinion, the so-called “studies” alluded to in prior posts were nothing but “junk science”. Someone took 5000 (pick a large number)closed claims and looked for a common thread among the policyholders. That is not “research”.
3) When you do real research, you do not start with a premise and set out to prove or disprove it. It appears to me that all of these “studies” started with a premise and took “snapshots” of current data. They then made assumptions and have used data from the snapshots to prove their assumptions. I can do the same thing by looking at a prison population and noting that 80% of the convicted felons prefer mashed potatoes to fries. Therefore, if you prefer mashed to fries, I am going to consider you a likely felon. My study proves it doesn’t it ?
3) I demand proof that any of these “studies” were conducted as “real research” by asking the following:
A. Which of your “studies” selected “X” number of insurance policyholders at random?
B. Which of your “studies” followed their significant random selection and collected accurate, factual (blind) data for “Y” years? In real scientific research like this, the data collectors have no clue as to why they are collecting the data other than it is for research. Many items are collected which are never used in the formulation of the conclusions.
C. Which recognized and accredited professional research entity examined the data and revealed the results of the data which clearly confirm credit score directly or indirectly influences any individual to act in a manner that results in the individual contributing to an occurrence involving liability or property damage that an insurance policy may or may not cover?
Summary: Yes, credit scoring is here and is being used and I must deal with it. I do not accept the studies being touted. Why hasn’t credible “research” been made available to the public in an easy to read and understandable format? Get it out in front of the public and let’s see if we have something real or something imagined. I maintain these “sham” studies would not stand up to professional competent scrutiny.
Regards, Dar Novak AAI
Sock-puppet here. I’m in year 32 of my insurance career and, as such, I am aware of the trashing of years of statistical data collection. We used to utilize all types of information until some social engineer decided it made people “feel bad” to be charged insurance rates based upon their occupation, garaging address/place of residence, et al. Our societal mores change so quickly that we’d never be ABLE to collect 20 years of data to legitimize your theory of research. Further, why do we need 2 decades of research when we have potentially millions of test subjects right now? Insurance isn’t rocket science, sir. I submit that you would never find it fair until your belief system is completely validated by the insurance industry.
I have been in the business for 32 years too Brokette and I feel the same way you do. If this fellow can’t buy the numbers and various studies done tough. The numbers are right and even though we may lose this fight in the long run I still think it’s a completely valid program. By the way, only the ego freaks post their own name from my experience.
When someonei this great country takes a civil service test they get graded on a point curve. Certain groups like disabled veterans get extra points. Why not offer distressed socio economic groups a step up with a government mandated credit bail out proposal. Everyone who ever defaulted on a big screen TV purchase would get 100 extra points on their credit. Auto repos would get 200 points handicap and a home foreclosure would get 300 points. You would only be allowed to get the credits 1 time and only two sets of credits per address. Couples would not have to be married only shacked up any 21 days of the last 365.
Yeah but then a couple could get a joint score of like 1200 if they each lost a big screen, a Lexaus, and a house on the sub prime. If you only need 800 for the good credit then tax the other 400 points and share the wealth.
One problem with credit handicapping would be who decides the points? Example; How many points do you get for letting something go back to Rent-A-Center vs. if you were buying it instead of rent to own. What about breaking an apartment lease. We are going to need a new government committee to do the ratings. You know like a Department of Credit Handicapp Rtaing Bureau.
Credit rating is like all other laws of large numbers. It works overall but is not fair to some. When you discriminate against young male drivers under 21 you will unfairly hurt the few of them who will never cause an accident. However overall it is the best way to date to justify the high cost of these young male drivers overall.
This thread has quickly gone done hill –
And with that I am turning off the auto email notification.
Amen! There has to be better people to communicate with today than you folks!
Throughout these posts numerous people want to see the data on a person who makes $20k versus $100k. Hasn’t anyone realized that this is a question that is not used by insurance companies in determining a rate? THAT would be a discriminatory question.. So keep asking for the info and arguing the point..It is info that can’t be reliably produced.
Its the government who is getting ready to ban it – So, they should have access to this information not the insurance companies – The credit bureaus who compile this info and compute your credit score know everything about you and are all regulated by the government.
Just press the right button on your super computer and send the answer to the congressmen.
Then we will know whether or not scoring dicriminated against people who make less money.
dam staffman – think b4 you post you just got schooled!!!
Yea staff man – what r u talking about??
Credit scores dont come from insurance companies they come from places like equifax. So if congress wants to ban scoring they can just ask the questions from the credit bureaus, they know everything about you, you dummy!!
Ooh, I’m really hurt by that. How ’bout the rest of you guys? To Mike & Jake on some ethearal plane–“Try to imagine how little I care.” Buh bye, guys.
Be carefull Brookette, your act is wearing thin too.
Prior to insurance I worked at a credit card company. The information used by scoring companies is only as good as the data provided on a credit app. Same as an insurance application. Often this information is not provided, even tho it is asked for.
Also, the post that have been out there have been aimed at insurance companies providing this information to prove the statitical data going into rate.. How do you figure that the government is now going to provide this info? Before schooling me maybe you should pull your head out and understand what you are asking for.. Again having these vague notions of super computers doing eveything by pushing a button.. next you’ll tell me you still believe in Santa..
So staffman you dont think that the credit agencies know how much money people make per year?
And you are wrong, no one said the insurance companies should provide this info, how would they know how much you make?
Maybe someone suggested that the insurance industry should sponsor a study.
Once again, once the government gets involved you have access to all the info you need.
You are an idiot if you dont read the posts more carefully and if you think that congress cant get info for a study on how much people make as opposed to their insurance score – its pretty simple.
Keep name callin’ if it makes you feel like a big man..
Working in staff for one of the nine companies, the FTC has been in contact with with everyone for 2-3 months prior to their formal request for information. Knowing what they are inquiring about give me an insught to where they are heading on their quest. I will not elaborate, but most of these posts don’t seem to be on the mark.
I am taking your advise, which obviously you are not, and signing off this post because it has degraded to name calling.. Now go back to your CSR job before the principle of the agency catches you…
First, I think my finger is sore from scolling so far down to respond.
Second, ouch! Brokette, you are sharp as a knife. Very funny, but I’ll bet it’s painful on the other end.
Merry Christmas, everyone!
Actually, one of the more common problems I read about credit scores is that they DON’T take income into account. They count $X of debt the same whether a person makes $20,000 or $100,000. If the credit agencies had this information, wouldn’t it make sense to use it?
I find it more painful to sit in silence and bear the judgements of people who know nothing about me. People who can do no better than name-calling don’t impress me. Thanks for the analysis, boys!
First, there are two different things being discussed. Credit scores are generated by the various credit agencies. They are flawed, and because the system is still very “black-box”, it is difficult for the individual to get their hands on and effectively correct. But, it’s gotten better in recent years, and hopefully, the system will continue to improve. Especially now that more than making a credit purchase is being determined with it’s use – ie: electric rates, apartment rentals, even the ability to open a bank account. Not being able to buy an expensive automobile is entirely different from being told that you can’t live in a nice apt complex, and must move to the next crime-ridden zip code. But, all of that is an entirely different issue.
Which brings me to point number two. An insurance score is different from a credit score. This article pertains to insurance scores – and, in particular to their appropriate or inappropriate use for Homeowners Insurance. I think it’s fairly reasonable to conclude that the validity to auto insurance has been shown. Peoples habits and attitudes directly contribute to their overall ability/skill, or lack thereof, in operating a motor vehicle. Whether this transfers as reasonably to Homeowners, I believe can still be argued. For the most part, people’s credit will not determine whether they are hit by a tornadoe, earthquake or sweeping fire. Upkeep on the home can possibly effect the degree of damage caused by these occurances, but only in a very small way (in my opinion).
Sure, there is the moral hazard, but that’s always been underwritten for the likely suspects – the folks with absolutely horrible credit histories. By and large, the average consumer that just pays his bills a little late, and runs his credit cards on the high end of the limits will NOT be burning their house down. They are not criminals – just a little less responsible. Yes, their roofs might not be changed as often. But, for the most part, those are going to be changed by insurance companies anyway. It might postpone an individual home, but when you look at the large numbers, roofs are being replaced every X number of years.
Here is something I know for fact in my own agency. I have Home underwriters that credit score and those that do not. My loss ratios are nearly identical in both groups. We obviously sell more policies to good credit risks in the credit-scoring companies, and worse credit risks in the no scoring companies. So, you would think those ratios would be higher in the non-scoring companies. Yes, they charge a little more, but it’s not that much different. My gut says there is a little difference between the two groups, but I’m not sure the difference is worth the cost of running all the scores and constantly programming all the computers – not to mention the obvious public distaste for the practice which leads to negative advertising.
I have NOT read all of these studies recently, but I know in it’s infancy, I paid much closer attention, and I don’t recall any that were related to Homes, only autos. If that’s true, then an investigation on the efficacy in Home Insurance is not unreasonable.
In conclusion, though, the arguements that by pushing a button, the government can determine if the practice discriminates against poor, minority, or religious class, is simply not true because the insurance companies are not using (for the most part) a FICO score. They are custom ordering desired traits that are only portions of the ingredients that lead to a credit score. So, because folks with a FICO score of 650 fall into a given group does not mean their insurance score would …and vice-versa.
It’s all an extremely complicated subject. Not because the ingredients are complicated, but because access to the ingredients of an individuals history are NOT going to be known unless the three credit bureaus opened up their files completely and ChoicePoint revealed all of the various matrices that go into the resulting “insurance score”. That’s not going to happen ever, in my opinion.
Brokette,
I hope you didn’t misunderstand. I think you’ve done a fantastic job of stating the facts and defending yourself. I’m not beating up on you at all.
It’s difficult to have the best discussion in this kind of forum. Our own prejudices and manner of reading the posts will skew the spirit of many posts.
But, that doesn’t make this any less fun on occasion.
Thanks for the clarification. I don’t take anything personally since, I suspect, no one in this forum knows me personally. I just long for “good ol’ days” when we could have a rousing (or an arousing) discussion and still be friends. I fear we’ve lost that but hope springs eternal. Have a wonderful holiday!!
Staffman wins the award for being the biggest Grinch on Christmas Eve. Anyone agree? What a grump. I got a good laugh reading his posts.
Apparently you completely misunderstand those of us who see Social Security for what it is and, therefore, feel rather cheated. You bet I will gladly collect my pittance in my golden years IF there is anything left. However, there is no way it can be considered contradictory to my thoughts on Social Security since I and my employer will have paid a huge sum of money into the system out of my wages.
If I have personally invested this same huge sum of money, I would likely have a few million dollars to MY NAME that I would do with what I please including pass on to children. I will take this option every day, all day over the option of having my money confiscated by the government, sqandered by said government and then distributed as they see fit including the possibility of telling me there is nothing left.
Everyone is entitled to their opinion, please, but you might want to think through your “position” before making such an inane post.
FYI – An Insurance based credit score and your FICO are two very different things! Some characteristics are the same but some are also different, for example claims history, payment history, etc. If you visit Choice Point’s website you will be able to see the MANY different characteristics that insurance companies ask choice point to use for them specifically.
Give me a break, Hitler! This is called profiling. I thought we were Americans. Is there any discrimination in the Veteran’s Cemetaries? Any time you have thoughts like this you are degrading the lives of young men and women that have died for this country—Black, yellow, red or brown.
Our nation will be restored when it works for the citizens and not for the corporations. How long did it take Congress to raise the minimum wage? You know that it will take that long if any of these ethnic groups has a loss and needs the insurance companies help. Give us all a break! You are dealing with Americans.
To Curious:
Think of it this way, when a child first gets their Driver’s License they are usually 16 and have never driven. So technically they have a clean driving record yet they as everyone knows they are the highest risk (aside from DUI offenders) to an insurance company. So one will pay more for someone with a completely clean driving record but is statistically proven that they are can potentiall cost the insurance company the most.
Similar concept with someone with a low insurance based credit score. Higher liklihood of missing payment, having a policy cancelled due to non-payment, and sadly higher risk of attepmting to commit insurance fraud, file frivelous claims. The insurance rate is based on the potential risk you present.
Greg,
If I miss a payment, my policy is cancelled (provided certain mandated notice requirements are met) – thus I am no longer a risk for the carrier (and the carrier is under no requirement to reinstate my coverage).
If I am such a bad risk, my driving record should show that, not based on the credit score but something much more tangible – real experience.
Let’s look at it this way, who is a better risk to the insurance carrier: 1) a driver with a perfect credit score but multiple moving violations; 2) a driver with a low credit score but a perfect driving record? They are equal in credit-score monger’s eyes – but which one has shown the truest potential for costing the carrier money?
If the driver with a perfect credit score is a bad driver, he’s still a bad risk; period.
Credit scores say NOTHING of a person’s ability to drive or obey the rules of the road. There is no causal nexus between stupid money management and bad driving; it’s like saying all people of a certain race are bad drivers – it just doesn’t hold water.
And, if it’s true that there is a correlation, the insurance carrier is double dipping. They get the higher rates for poor driving history PLUS the cost associated with a bad credit rating.
A lot of the arguments would be silenced if the carriers would show exactly how much of an effect on the ultimate premium a bad credit rating has. If it’s anything more than a minor (less than 2%) difference, it should be abolished. My fear is it is a major factor.
You people in here posting about the Insurance Based Credit score have to understand that this rating is not specific to determining whether someone will have an accident, it’s a factor but includes more.
It affects things like making your payments on time, letting your policy lapse due to non-payment, and how you take care of your property. These things can lead to claims and more damage to the proprty than less if not taken care of properly so ultimately costs the insurance company more.
Not every insurance company automatically cancels your policy when you miss a payment.
Greg,
Please tell me what company doesn’t cancel for non-pay. You’ve got to be making that up.
Name em, or you are.
Greg,
Fess up; what part do you play in credit scoring to hold on to it so dearly with only hearsay evidence. An actuary would back it with hard data; although I doubt there is any truly provable hard data that is reliable.
Since our economy is doing poorly right now, won’t more people’s credit begin to suffer? According to the big 3 car companies this is the case. They say they can’t sell cars ’cause about 40% of the car shopers have been unable to qualify for credit in the last couple of months – this according to NPR news reports. That being the case, we now have far more poor drving risks according to your postulation. What happened, did they forget how to drive when the economy tanked?
Also, we teach poor money management in the US. Just one example is pre-approved credit card offers to students while still in college (guaranteeing problems immediately upon graduation).
Sorry, but I can make data say just about anything when I’m after more money.
InsisMyPassion, you make some good points and yes data can be presented in different ways to substantiate different conclusions. However, if the credit data isn’t credible or doesn’t “help” to predict future losses, then why are insurance companies so willing to spend so much money to order credit reports, integrate credit into their underwriting, and defend it’s use with state legislatures & insurance departments. Seems like a waste if it really doesn’t work.
I didn’t say they dont cancel for non-pay I said not every company cancels if you miss a payment, there is a difference.
I don’t need to tell you which ones, I work for one but I don’t feel the need to advertise it on here to you or anyone else because its irrelevant to the discussion.
Look, stop being so narrow sighted these scores are not used just for Auto insurance.
There is more to it then just saying oh just because I have a low credit score doesn’t mean I’m going to have an accident.
It may mean though that you have trouble making your payments on a vehicle you are financing and instead of letting the the vehicle get repo’d for example because you get behind on payments you drop it off out in the desert and set it on fire and claim it was stolen which happens all the time…If you don’t have problems making your payments you are less likely to something like that.
That’s just one small example, so these score are indicators of more than just future auto accidents, it can be related to filing claims in general.
Our nation will be restored when it works for the citizens and not for the corporations. :) thanks nobody imporant.RE: @companies ask choice point .
When there’s a disaster, the companies homeowners count on to protect them from financial ruin routinely pay less than what policies promise. Insurers often pay 30-60 percent of the cost of rebuilding a damaged home–even when carriers assure homeowners they’re fully covered, thousands of complaints with state insurance departments and civil court cases show.
Paying out less to victims of catastrophes has helped produce record profits. In the past 12 years, insurance company net income has soared–even in the wake of Hurricane Katrina, the worst natural disaster in U.S. history. Property- casualty insurers, which cover damage to homes and cars, reported their highest- ever profit of $73 billion last year, up 49 percent from $49 billion in 2005, according to Highline Data LLC, a Cambridge, Massachusetts-based firm that compiles insurance industry data.
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.
Did I say anything about race??? Hmm… maybe I did in invisible ink that only you can read. I was just giving you facts with absolutely no opinion of my own placed in there. I can’t believe that a group of individuals who are supposed to be insurance professionals know so very little about insurance and the way that insurance credit scores work. I am however finding this blog very amusing – a lot of us here in the office are astounded at the maturity level (or lack there of) of most of you. Keep it up though – it gives us all a good laugh on a Saturday when the phones are slower!
READ THE STORY.
study found African-Americans and Hispanics tended to have lower insurance scores than whites and Asians and, because of this, tended to pay more for auto insurance.
The other
Hmm… perhaps I should put this as simply as possible for you all – I have read the article – my comments had nothing to do with the race portion of the article AT ALL my comments were directed at the multiple comments I have read in here from people confused by the difference in a FICO and an insurance score. Really people, this is getting out of hand.
Out of hand? It’s getting out of this world.
But, for the record, I’m certain there are folks/post’rs that aren’t in the insurance business. They just surf and somehow find these things.
You are probably very right peon – I am just amazed by this whole thing. I think that as insurance professionals we should realize that we are always trained to look at the big picture. Stop focusing on the ONE sentence regarding race in the article and pay more attention to what they are trying to say. Also maybe keep in mind that the person that wrote the article may not have a full scope of what this means and what is going on. Jumping to conclusions and making crazy blanket statements like we are not american because we believe in charging the appropriate rate for the risk people present. FYI – if someone has really good credit but a poor driving history – their insurance score will probably account for that therefore they will be paying what they should. It is all about rate subsidization – it’s not fair for the entire membership to have to pay for other people and their risks. What I am saying HAS NOTHING TO DO WITH RACE. I do not care what the article says – this has nothing to do with that. I would highly encourage everyone to educate themselves prior to forming an opinion – that way we are all doing what’s best for our clients everywhere. I really hope that you will take my advice and visit the choice point website. What insurance companies do is pay choice point to run insurance scores on their members and each insurance company chooses the characteristics that are most important to them that decide what the insurance score will be. For that reason my insurance score at company A could be different from my score at company B. It’s not about insurance companies being bullies. It’s about insurance companies protecting ALL their members and ensuring that everyone is paying their fair price. AGAIN THIS HAS NOTHING TO DO WITH RACE. If anyone comments on this post saying something about race then you really need to work on your reading skills. By the way – this is not something that is brand new – it has been used for a VERY long time for many many companies – it is VERY likely that all of you who are also consumers have an insurance score with the company you are with right now. It doesn’t matter if you are white, asian, african american, hispanic – we all have an insurance score based on the risk WE present and we should all be paying the appropriate amount for it. Call your own agent since clearly you cannot figure it out on your own. And please – stop being so immature – we should all be adults and name calling and badgering is extremely rude. We should be using this website as a tool to gain more knowledge about our industry to do our job better. Face it – no one knows everything – we should be here to help each other learn – not bring each other down.
There are quite a few people who post here who just don’t like insurance companies. Melanie is a real hater. I haven’t seen a post from her in a while, but to her we are all cheats and liars. I don’t know what she does for a living, but I doubt she has any actual knowledge of how insurance works. I won’t comment more on this one beyond that this is a procedure that works and has been proven to work. Simple and yet way beyond the comprehension of the anti-insurance scoring posters.
PS – I was reading through some blogs and thought I should add – the insurance companies do not hide insurance scores – they are easily available depeding on what resource each company uses. This is why I keep pushing that you visit the choice point website because that is where consumers can go to find out their score based off of the insurance company they use and of course as long as that company uses choice point. For multiple reasons and legalities – it is not the responsiblility of the insurance company directly to provide consumers with their score – it IS our responsiblity to provide them with a means of finding this score out and finding what characteristics are coming into play when determining their individual score. I cannot speak for other companies as far as this goes, I can only assume it is the same, but where I work – we provide the consumer with everything they need to be able to access their score. We educate them about why this score is used and to be honest I find that after I explain it is not based off of their FICO and what it is based of off they become very understanding.
Just thought I would add that piece of info – I noticed some were under the assumption that we hide insurance scores from consumers. It’s illegal to hide that info and therefore we are more than happy to direct them through the right avenues of getting all the information they are entitled to.
:) thanks nobody imporant.
http://www.clarionledger.com/assets/pdf/D069388410.PDF
Edward B. Rust, Jr.:
Poverty of the Soul
Do you remember when your heart reflected the very best? Confidence led upright. You believed in honor, and then your life changed forever.
Greed became the poverty of your soul, robbing yourself of happiness. Lying, pretending to be kind, your success. Trickery, injustice, your reward, robbing yourself.
Wellllll – that’s enough of this thread. The kooks have taken over…
Credit scoring for insurance will not succeed for our indusrty any better than it did for the financial industry. Poor credit history has a higher frequency, than those with better credit. The problem, it should not be used as a primary factor.Conversely, what if we used MVR’s to for auto loans. So if you have 2 citations and perfect credit you pay more than one with perfect credit and no citations. That has the same indicator value, as we know people with poor credit gets more citations. My point is very simple unrelated indicators should not be used (valid or not) to price your product. Look at the credit card company’s, they are overcharging those of lesser credit, and undercharging those who can afford a higher rates. In closing, we need to insure ALL at a fair and profitable rate………
Its just pure and simple logic.
less responsible. Company management is interested in cutting expenses the easiest way possible. The same management that makes the decision to offshore also makes the decision to reduce oversight
Comment:LOOK IT UP.
http://www.clarionledger.com/assets/pdf/D069388410.PDF
We should be using this website as a tool to gain more knowledge about our industry to do our job better. Pay more attention to what they are trying to say. Reading skills.
AIG took the ‘easy way’ to beef up profits in their non-regulated world.
you are right,some people just want something to fuss about.
i could not have said it better.
many idiots in the insurance world??? YES THAT MY FRIEND IS MY PONIT.
I DID NOT PULL THIS STORY OUT OF THE AIR. ITS THERE FOR ALL OF US after hurricanes Katrina I READ ALL ABOUT THIS GREAT BIG GIANT’S HISTORY. PEOLPE LOST LOVED ONES AND THEIR HOMES AND THIS GIANT SAYS THAT WE DONT CARE! WE ARE BIGGER THAN THE WORLD. WE CAN MAKE LAWS WORK FOR US BECAUSE WE HAVE MORE ATTORNIES THAN ANYONE IN THE WORLD SO NO ONE CAN COME UP AGAINST THE BIGGEST MUTUAL INSURANCE COMPANY IN THE WORLD
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 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 .
So if I tell you that my raison d’etre is cheating poor people THAT will make you happy? I don’t have TIME to focus on cheating poor people. I’m too busy trying to put a roof over my head AND pay the usury taxes California thinks are so essential to life–mostly illegal immigrant life. Stop deluding yourselves. EVERYONE faces obstacles in life. Some overcome them and become successful in spite of them. Others whine and look for someone else to solve their problems, Guess who’s rich?
Insurer anti trust exemptions will be repealed some day. They hey days of the wind fall profits are comming to am end.
When congress has hearings over the big bail outs it will all come out in the wash. The industry will be come more regulated then ever. And of course less profitable. Fat will be cut out and insurers will be forced to follow the laws that the rest of us do.
Remember the hey days of big insurance profits as the days are winding down and are numbered.
Consider this,
First the insurance based score is NOT a primary factor in determining premiums, it is simply, A factor of many.
In your example you say lets say we use MVR for auto loan, this is not a bad idea and here is why. If I’m a lean holder, and you have a poor driving history there is a higher liklihood of you getting into an accident, therefore the leinholder is in fact at greater risk, they want to protect their vehicle while it is still being financed.
If a vehicle has been in an accident and even if your insurance company repairs it, it can still depreciate the value of the vehicle therefore if the leinholder does at some point have to repo the vehicle they now have to take an even greater loss.
It definately shouldn’t be a primary factor but it should be A factor. Problem with our country today people don’t want to take ownership and responsibility for themselves anymore.
Pay more attention
Comment:
Comment:LOOK IT UP.
http://www.clarionledger.com/assets/pdf/D069388410.PDF
We should be using this website as a tool to gain more knowledge about our industry to do our job better. Pay more attention to what they are trying to say. Reading skills.”obstacles in life.”Brokette just read and think about other people who have no roof have no home at all.
This article is a perfect example of why people need to be more selective of who they choose to insure with.
People are so focused on saving that extra few bucks a month they don’t consider the big picture. That article is not representative of all insurance companies there are good ones and bad ones and unfortunately the and obviously the bad ones give the entire industry a negative appearance.
However there are great stories about times when people are down and the insurance company comes in and saves the day as it were also.
I suggest that those of you actually in the insurance industry ignore this posting and move on. The majority of posters on this line seem to have an insurance company hating agenda and won’t hear anything regarding fact. As I said elsewhere, it’s like trying to argue with children. It may be paranoia, but I think some people are paid to post on this site and others to spread disinformation on insurance companies. Who knows why, but there is too much consistency of cutting and pasting of a lot of these nut case posts to be different people. Your are wasting your time arguing with these people who can never be convinced that insurance people aren’t the devils themselves.
Well said Greg.
A federal judge in New Orleans has dismissed an antitrust lawsuit Louisiana’s former attorney general filed against some of the nation’s largest insurance companies after hurricanes Katrina and Rita. “Crooks” !!!! 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. [ MR nobody important]
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
This problem is NOT whether credit scoring is an accurate predictor of losses. The problem is that income IS reflected in credit scores in spite of Equifax and Experian’s claims to the contrary. Credit scores measure the % of available credit a person uses. The higher the usage %, the lower the score. And, the amount of credit available to any person is directly related to that person’s income. So, a person on the lower end of the income scale is going to have a very low credit limit available and a person on the high end will have a high credit limit. If both people use their credit card to buy tires, for example, the lower-income person will use a significant portion of their credit limit than the higher income person, resulting in a lower credit score for the lower-income person. In addition, lower income people are more likely than higher income people to use their credit cards. Higher income people can pay cash for their tires. Lower income people need to pay on installments. In short…the system is skewed in favor of higher wage earners….whites and asians. It’s not discrimination against a RACE, it’s discrimination against the poor. The poorer you are, the more you have to pay. Lower credit scores mean higher insurance costs AND higher interest rates for homes and cars, etc….. Meanwwhile, the credit reporting companies rake in billions of dollars selling information that is often inaccurate and for which they have NO responsibilty to verify before they sell it. If it’s wrong, the person affected by the erroneous reports will spend YEARS trying to clear their records…meanwhile paying more for everything because of a low credit score. It’s the people who sell credit information that need to be investigated and made to cease & desist. If they are going to sell information, they should be required to make sure it is fair and accurate BEFORE the publish it.
AIG received $150 billion in loans from the government to help it remain in business.
In addition, lower income people are more likely than higher income people to use their credit cards. Higher income people can received $150 billion in loans from the government to help it remain in business.
Good info.
However I personally see nothing wrong with that you said. The poor, or lower income earning segment of the population is more likely to default on loans and submit frivolous claims or commit insurance fraud.
So the ratings are such that the companies can protect themselves by charging higher interest rates and allowing those to have lower credit limits.
Its simple math, if Im a creditor why would I allow a poor person to have a credit card with a $20,000 limit when I know IF they maxed that credit card out they would be less likely to pay it back. I subsequantly charge a higher interest to ensure they are LESS likely to use it, and use it for emergencies (Which technically is what CC’s SHOULD be used for) than for daily spending. Its a system in place to somewhat help people to spend their money efficiantly and correclty and not to over extend themselves.
That’s the way Home Loans USED to be until the Liberal side Governmant got involved and forced lenders to offer loans to people that really ouldn’t afford them so they could buy the nice big house and live the American dream of, “Everyone in America is entitled to own a home” which is NOT the reality.
Now because the Govt at the time decide to regulate and force lenders to offer rediculous loans to these people that couldn’t afford them they start foreclosing when interest rates go up and then the economy as a whole takes a dive because now the banks are losing so much money.
It all falls back on Americans that DONT want to be responsible themselves and their own decisions, who try to live outside their own means, and when things go wrong they blame the govt and the banks.
DONT want to be responsible themselves and their own decisions, who try to live outside their own means, and when things go wrong they blame the govt and the banks.
LIKE AIG GRAY!
I think it would be an interesting study to perform IQ tests on drivers at different levels of insurance rating scores.
Take a representative sample from each score level (below average, average and above average) and have them complete IQ tests.
What do you think the the results will look like? Will they follow the insurance scores?
Everyone post back, I’d like your opinion. Not making judgments or accusations here, just thought it might be an interesting study. And don’t give me the argument of cultural bias as that is the same argument against insurance/credit scores. Just wondering if there is a correlation.
have them complete IQ tests.
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
I scored in at 138 (not so low that I had to beat up the nerds to keep my self-respect and not so high as to cause me to miss out on high school’s best life lesson – teen sex). I had a business deal go bad (actually resulting from a marketing decision made by a regional manager for an insurance carrier regional manager – another story for when I really want to rag on company-side execs), which cause a bit of financial stress on my end and a lowering of my credit score. Can you guess how that affected my insurance premium, hmmm?
A better question, I believe, would be how many of the high credit score, insurance carrier minions use cell phones when they drive? How many of the insurance carrier underwriters, sales managers, and CEOs drink coffee/coke/beer, apply makeup, eat the BigMac/fries or, better still, text while they drive? Idiots and hypocrites! Oh, right…I was suppose to wait for another rant on another day to post my feelings about company-side morons. Ahhhh, there I go again.
Are you trying to make a point about something?
I just ask because that whole second pragraph is irrelevant.
Anyway, unfortunately in a free market you really have to be careful about who you do business with taking all potential risks into consideration.
Such as if the person you are dealing with makes a bad decision it could affect your credit score, amongst other things. That is still your responsibility. So I “hope”, you aren’t trying to put all the blame on that regional manager person you described, right?
My point, and please forgive my lacking a proper education, which might have allowed me to make my point a bit more succinct and easier to understand (back to that teen sex comment and not paying attention in school), was that sometimes life happens and you are caught with your proverbial pants down. The action of the regional manager was, in fact, bordering on criminal, but let’s say that I should have felt the gun stuck up my bum before he pulled the trigger, and, as such, it was completely my fault. The extreme loss of income, the financial stress, and the resulting lowering of my credit score did not make me a higher risk the insurance carrier writing my auto insurance.
So, for all those years prior to credit scoring (a product/idea pushed by the credit collection agencies), you company-side Kool Aid drinkers are saying that the auto and homeowners insurance industry was not able to make an underwriting profit based on driving records/type of auto/type and age of construction/loss experience/policy histories?
It’s not that credit scoring isn’t a correct predictor of loss some of the time; it’s that it is simply the wrong estimator of risk to be using in this day and time. Far too many folks who are moral, upstanding clients are being undeservedly penalized because of an arbitrary, credit scoring formula.
Credit scores are further damaged by the current banking practice of raising credit card interest rates, in spite of timeliness of payment, which lead to greater financial stress and slower pay accounts, which result in lower credit scores and even higher interest rates.
Put the tool down and step away from the policy.
There my ADD flaired up and I forgot to answer your question about the second paragraph – so sorry.
Let me see if I can make it a bit plainer for you. The behaviours I mentioned (you know the ones – cell phone usage, drinking/eating/applying makeup and the like), are far more likely to be the cause of claims, and many on the carrier side of the business are guilty of such behaviour. Hence, the comment about idiots and hypocrites. Not sure I can state it more clearly that that.
Somehow, and this may just be the mind of an uneducated lame brain sputtering nonsense, there seems to be a bit of relevance in the statement for the discussion at hand. Ummmm?
But, then what do I know? I’m not an insurance company lackey.
I’m not trying to sound insulting by any means I’m just simply stating that when you go into a business deal with someone you take some responsibility too, now granted there can be situations where you can get totally blindsided, if there was something illegal that happened then and you were not the one comitting a crime then it should have affected your credit.
Ive already stated this before, but again, the insurance based credit score is the the ONLY thing that affects your premium, it is a VERY SMALL part of MANY different sets of criteria that goes into underwriting the risk you present to the company.
MOST of the time, if you have an existing policy in affect and a good standing with the insurance company you are insured with then the credit score won’t even impact you if it decreases while your policy is in affect, and a lot of the companies that use credit scoring just use it the 1st 2 years your policy is in place and no longer consider it after you’ve been with them a while (or after those 2 years).
The only thing I was saying about your second paragraph is that everything you mention can apply TO ANY PERSON DRIVING, ANYONE, those activities you mention are not specific to any one set of people and further, wouln’t matter anyway, UNLESS they get in an accident.
Again, credit scrogin has nothing to do with your driving ability, habit, record..Insurance companies use it to determine the risk you present.
Are you more likely to miss payments, have your policy cancelled due to non-payment, lie about your current situation to get a lower premium, file frivolous claims, or commit insurance fraud, all of which the insurance company has to soak in as losses that have NOTHING to do with driving.
Maybe you should take the time to educate yourself about a subject before you comment on it. You and others posting about how evil insurance scoring is have no knowledge of the actual mechanics of insurance. Try learning a little about something before you try to indict an entire industry for a crime that never happened. By the way, insurance scoring is not a credit score. Insurance scores have other factors taken into account. I know it doesn’t matter to you since you have your paid posting to place, but for someone who isn’t being paid to write this trash it might be a factor.
Even government mandated insurance laws give us the option of finding another financial mechanism to comply with the law. So for all of you insurance haters, I have two words–SELF INSURE.
…”if there was something illegal that happened then and you were not the one comitting a crime then it SHOULDN’T have affected your credit.”
Should say SHOULDN’T have affected.
“Ive already stated this before, but again, the insurance based credit score ISN’T the the ONLY thing that affects your premium,”
Should say it ISN’T the only thing affecting your premium.
Huh? LOL, you have got to be kidding!
29th year in the idustry.
Try educating yourself in the mechanics of manufacturing and selling ideas and products before you indict the naysayers.
This credit scoring/rating formula is a sham, and, hopefully, soon to be uncovered and revealed as a crime against the American people. You carrier-side lackeys will just take the stand and claim to only be guilty of following orders.
Just a bunch of simple-minded, arrogant accountants driving the industry into a wall! You should be ashamed.
If life is simply an extention of high school, then it’s high time for the bell to announce PE class! Lets line all the accountants and lawyers up against the wall and let the dodge balls fly!
Nobody important – Who do you think is paying him to make these posts?
And, seriously is ins scoring that much diff than credit scoring? –
In my experience when someone says they have a bad credit history, BINGO, every time, that means they have a low insurance score!
Its not rocket science, although they would like you to think it is just to shut you up.
Don’t know about your state, but in ours the coverage is statutory.
” THAT,S THE ONLY WAY TO CURE AN ILLNESS. RIGHT.
Nobody: I’m for insurance based credit scores. Not against it, I think it’s a good indicator of future potential losses.
Lame Brain: Auto Insurance is statutory in all states. You can CHOOSE to insure through one of the many auto insurance companies, or you can CHOOSE to self insure as well.
FYI, if you choose to self insure I guarentee you it is WAY more expensive. You just need to show proof of financial responsibility to the state.
Back to your “2nd paragraph”.
You do realize the EVERYONE is subject to insurance based credit scores right?
Whether you are in the insurance business or not, my policy is affected by an inusrance based credit score and I don’t have the best credit (it’s not that bad though.) but I’m impacted also. So its NOT hypocritical because those behaviors, and subsequent potential losses, and the credit based scoring is used on EVERYONE.
East News
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Tort Reform Group Labels One N.J. County A ‘Judicial Hellhole’
East News • December 19, 2007
Atlantic County, N.J. has earned a dubious ranking: It’s one of six “judicial hellholes” nationwide, according to one tort reform group. “Personal injury lawyers seem to have gained a monopoly …
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Insurance Journal is not responsible for the content of the message below.
Subject: Read about The real story!!!!!’Judicial Hellhole’
Posted On: December 20, 2007, 8:28 am CST
Posted By:
Comment:
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.”
This is the kind of garbage I think is posted by paid posters. It’s in writing so it must be true?
Lame Brain. 29 years in the business and this is your level of knowledge? I have 32 years in the insurance industry. I win. Some people never learn anything about the industry they work in and you appear to be one of those people. You need to get out of the industry if this is your level of knowledge.
Of course there are professional posters. Didn’t the last election teach us that? There are several organizations that are anti insurance company and may well pay posters to cut and past the garbage that’s repeated over and over on these sites and many others. That’s the modern world of the web people, not paranoia.
I agree there are paid posters, but seriously, I think they are actually smarter than the “cut and paste non-relevant material” jerks who are making no sense.
I would expect the insurance companies with the deep pockets to be more likely to employ that tactic anyway.
Insurance companies are only interested in actual activity that will increase writings and profit. Any activity such as this is simply wasted company time on my part. Oops.
As I was watching these tapes I just want to say this for the record, the
okay we have tapes and we have records. wow.
Maybe you should take the time to educate yourself about a subject . thats the only way
Some of the posters are like small children. They see something they don’t understand and say “that’s just stupid”. Take the time to find out how something works before condemning the entire insurance industry to purgatory.
I actually have nothing to say this time around because I feel like I gave pleanty of stone cold facts before and don’t really feel like repeating myself… I just popped in to say WOW – this is getting steamy. It’s starting to make perfect sense to me why consumers resent insurance – because of the sheer amount of IDIOTS working in the industry!
nobody important
Comment:
This is the kind of garbage I think is posted by paid posters. It’s in writing so it must be true?
NO IT,S CALL RECORDS AND TAPES IAM NOT PAID IAM AN ORGANIZER.
I don’t even know what to say – how is it POSSIBLE that there are so many idiots in the insurance world??? Well – nevermind on that one. CLEARLY insurance scoring works – read some studies for crying out loud – that is – if you can even read AT ALL!
LOUD NOISES!!!!!!!!!!!!
Love the Anchor Man reference — LOL!
Something always seems to be catching fire in this state this time of year, but when the worst California wildfire in over century swept through here a while back, it ignited a storm of controversy. It’s about insurance and whether your home is in California or Carolina, or whether it’s near the wild or in a city, you’ll want learn what happened to homeowners here. The fire four years ago killed 15 people and also destroyed more than 2000 homes. But many residents here had planned for the worst and took some comfort in the insurance policies they purchased, coverage they expected to make them whole again if the worst ever happened.
After the fire, what many got instead was aggravation, and the bitter realization that home replacement insurance plans in many cases didn’t pay to replace homes.
In collaboration with the investigative reporters at Bloomberg markets magazine, we found these controversial practices by insurance companies are widespread in an industry with little federal oversight.
1 conceal claim mishandling. 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 indifferen . 3 jury award in auto liability cases rose from $187,000 to $269,000 in 2000, an increase of 44%. 4. billion,s was awarded . GET THE PONIT.
Federal oversight is not the answer. I can assure you that the State of California provides oversight well in excess of anything the Feds could offer. Further, our State is THE market for personal earthquake insurance that would be completely irrelevant in a place like, say, Kansas.
Just because a person’s fire insurance settlement doesn’t feel enough like welfare to make them happy, doesn’t mean something untoward has happened to them. I can state with relative certainty that most people purchase their personal insurance based solely on its price, not the comprehensive nature of the coverage.
But whats that got to do with the article or with insurance scoreing?
Also, there is no one here that would be influenced by your spam, we already know whats up.
Contact the media, or State Farm directly, you are just wasting your time with us.
We are not agents for State Farm. Sorry
Edward B. Rust, Jr.:
Poverty of the Soul
Do you remember when your heart reflected the very best? Confidence led upright. You believed in honor, and then your life changed forever.
Greed became the poverty of your soul, robbing yourself of happiness. Lying, pretending to be kind, your success. Trickery, injustice, your reward, robbing yourself. 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. Consumer would go to prison for that type of behavior!!
Also, there is no one here that would be influenced by your spam, we already know whats up. [YOU HAVE KNOWN !A HAVE DONE NOTHING ABOUT IT ! BILL THAT MY DEAR FRIEND IS WHY THIS COUNTY IS IN THE HUGH MISS – IT,S -IN . KNOW ONE WANTS TO STEP UP TO THE PLATE WHAT A SICK DIAGNOSE .WAKE UP HAVE A CUP OF COFFEE AND SAY I CAN . IS THAT SO BILL].
Well youre nuts. Are you from Nigeria? Something doesnt seem right about you. You cant write.
Nobody here can help you, you are a freek. This is not State Farm you loser.
I believe that a large amount of the graft and fraud in the insurance industry could be prevented if they would just administer a “morals test” when the insurance exam was administered. The violators today may be few in number, but are HUGE in the damage that they inflict on the American public.
WOW! So I’m sitting here wondering, “Why hasn’t State Farm been the subject of a nationwide mass tort bad faith action?” I can’t believe your brethren in the legal community are letting THAT opportunity pass them by. Further, why is ANYONE buying insurance from State Farm when they are so obviously engaging in deceptive claims practices? Aren’t there ANY other honest insurance companies in this country? Just curious.
THE PLANET
Comment:
WOW! IS THIS WHAT SCRUGGS WAS UP AGAINST? THANK YOU MR SCRUGGS FOR TRYING TO STOP THIS GIANT. THE SAD THING IS THAT YOU ARE BEHIND BARS AND THIS GIANT THINKS IT CAN DO ANY THING IT WANTS AND WE WILL ALL LOOK AWAY. I DID NOT PULL THIS STORY OUT OF THE AIR. ITS THERE FOR ALL OF US after hurricanes Katrina I READ ALL ABOUT THIS GREAT BIG GIANT’S HISTORY. PEOLPE LOST LOVED ONES AND THEIR HOMES AND THIS GIANT SAYS THAT WE DONT CARE! WE ARE BIGGER THAN THE WORLD. WE CAN MAKE LAWS WORK FOR US BECAUSE WE HAVE MORE ATTORNIES THAN ANYONE IN THE WORLD SO NO ONE CAN COME UP AGAINST THE BIGGEST MUTUAL INSURANCE COMPANY IN THE WORLD. WOW! THIS IS LIKE A DOCTOR EVIL MOVIE, OR IS IT JUST THE PLANET OF THE APES?
. 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
Some people questioned my statements that there are professional posters hitting this site. I think this line of postings is a prime example of professional posters. I can’t say I have ever seen such a line of uninformed and illogical garbage posted. The insurance company hating nuts are out in force. How do you try to explain business practices to posters with bats flying around in their heads? Don’t try.
Just so you know, if you dont know how to read and write, or are not indigenous to this country, often times they will ignore your claim or assume its fraudulent.
If your writing is this bad, I can only imagine how you must sound on the phone.
I wouldn’t give you a dime.
What is this, a posting for random thoughts? I once wanted a puppy. This is just as relevant to any discussion of the actual subject here.
Good point, nobody important. I’m not sure where I came up with the crazy notion, but I was under the distinct impression the article was about credit scoring. Silly me….
Greg,
Again, please forgive my having checked out the ladies instead of reading through the chapter on sarcasms during high school lit. My failure to maintain proper focus during those valuable sessions has caused me great distress during moments such as this over the years that followed, don’t ya know.
The point I was attempting to make, in that now infamous second paragraph, is that individual behavior and attitude of heart are better predictors of future loss than is an arbitrary credit score, however cleverly formulated and determined.
The very folks who depend upon these scores to “cherry pick” accounts are more than likely guilty of some or all of the careless driving behaviors mentioned in that paragraph. Hence, they are idiots, for eating/drinking/texting/applying makeup while driving, and, hypocrites for pointing accusing fingers at the low credit scoring population as being higher risk deserving higher rates, all the while, ignoring their own careless driving habits. Perhaps the next tactic should be to train agents in reading body language or develop sensory chairs (lie detectors) for prospective clients to sit in while being questioned about cell phone use, eating habits and the like.
By the way, these folks who promulgate the rates are not low paid employees. As a result of being locked into windowless rooms in the sub-basement of their respective Home Offices, they may look pasty and smell like fungus, but they are well paid for their voodoo rituals and mad science. It’s easy to impose an arbitrary standard upon the masses when you are sitting well above that mark.
Did that make any sense at all to you?
Actually, no, Lame Brain. Cherry picking in the real world, is called underwriting. Businesses, ones with sense, sell their product to make a profit. Not an evil thing. In our business, you underwrite. Pricing and selection of what coverage to provide and to whom. Why should a company want to write a class of business that will cause them to lose money. No business should do that. I could go on and on like the insurance company hate posters here, but they won’t listen anyway. I hope you go into a business or occupation that can afford to provide your product at a loss every year. If you do, it’s probably government service. I’m done here. The nuts win.
I have been torturing myself for a few days now reading posts about this article with many of the posts either venturing off into unrelated topics or missing the essence of credit scoring or predictive models.
First of all, modeling is not about cherry picking the best accounts. Rather, it is about pricing risk at an appropriate level or the level at which the carrier expects to earn a desired profit. With models placing accounts in quartiles or deciles, the carrier would write a risk or insured in a higher or worse decile all day long as long as it is priced appropriately. By “right pricing” risks, the carrier is attempting to optimize its ability to earn a profit on its book of business. Of course, though, it is likely a carrier would employ a strategy aimed at writing accounts up and down the lift curve comprised of those quartiles or deciles.
If the carrier prices to high or has an excessive profit target, then they will have difficulty attracting customers. If the carrier underprices business, then might attract plenty of clients but at the expense of profitability.
Modeling also has at its core a critical principle of insurance — the law of large numbers. There will always be loss free (both past and future) risks or insureds in a category deemed to have a high propensity for loss. Actually, the most common loss ratio for insureds in a higher or worse decile might actually be zero. However, as a group those insureds are expected to perform worse than average in terms of loss activity. The expectation is based, in many instances, on highly sophisticated predictive models using such variables as credit score, loss history, driving records, premium payment history, age of driver(s), age of vehicle, crime statistics, etc.
Another issue that seems to be lost on many posters is the company-specific nature of many predictive models. There are certainly “off the shelve” models carriers can purchase. However, many carriers have allocated significant resources to developing models using many years of their own loss experience as well as data or variables deemed to be very predictive in terms of expected losses. It is in a carrier’s best interest to bring in as many variables or predictors of loss. A signnificant amount of analysis, testing and monitoring are involved in any good modeling initiative.
The bottom line is that insurance carriers want to achieve an optimal balance between the need to generate revenue and profit (i.e. wealth). Cherry picking might maximize profit, but drive down revenue and/or market share. Chasing business by underpricing it could certainly provide a boost to revenue and/or market share, but will likely tank profitability.
Putting aside misinformation, “insurance carrier haters” and conspiracy theories, credit scoring or predictive modeling is nothing more than a highly sophisticated underwriting process. Instead of using humans and/or tables to price an insured based on a handful of variables, models can use dozens of variables to more accurately predict loss and, therefore, accurately price a risk. Whether a carrier is “old school” or state of the art, they need to attract clients and earn a profit. Business is business, people, regardless of the methods used to analyze and acquire customers, so take a thoughtful approach to this subject in lieu of the misinformation and hate.
Buckeye, I will bet you $16.2 billion dollars in bail out money not one of the anti insurance posters will read or care about your informative and well written post. Thanks for putting a head on it.
Nobody Important – Glad to contribute in my own little way. I appreciate the opportunity to wager, but I’m thinking it might be a sucker bet. Of course, $16.2B could fall out of our pocket considering we are all “owners” of what used to be the largest insurance company in the world. Stay low and keep moving….it’s a jungle out there.
I give up Lame Brain,
You’re just not getting it. Beleive what you want, conspire how you wish, continue to be upset or disgruntled or whatever it is.
I tried to explain it in simple terms but you obviously are choosing to see how YOU want to see it and nothing else. I imagine it could be explained a 100 different ways and you seem the type that won’t care or be open to the reality of the truth of it.
The U.S. Court of Appeals for the Ninth Circuit has ordered a federal district court in Oregon to determine whether the public can see court records and evidence in a consumer fraud case that State Farm Insurance Company has battled for eight years to keep secret. On June 18, 2003, the Court of Appeals issued a long-awaited decision in State Farm v. Foltz reversing a trial court ruling that permitted the blanket sealing of discovery materials and court records in a consumer fraud case against State Farm Insurance Company. Trial Lawyers for Public Justice (TLPJ), a nationwide public interest law firm that intervened in the case on behalf of several non-profit groups that monitor insurance fraud, had urged the Court to rule as it did.
The information, which has been under seal since the underlying case against State Farm settled in 1998, may contain important evidence of abusive insurance practices. The Court of Appeals ruled that the documents were improperly sealed without any demonstration of a legitimate need for secrecy, and sent the case back to the trial court to decide whether a compelling interest exists to justify sealing evidence of State Farm’s misconduct.
“You can’t have corporate accountability if you have unnecessary court secrecy.”
in a consumer fraud case that State Farm Insurance Company has battled for eight years to keep secret. On June 18, 2003, the Court of Appeals issued a long-awaited
Why should a company want to write a class of business that will cause them to lose money. No business should do that. 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) WHAT PART TO YOU ALL NOT GET?
:LOOK IT UP.
http://www.clarionledger.com/assets/pdf/D069388410.PDF
We should be using this website as a tool to gain more knowledge about our industry to do our job better
government bailout that has now swelled to about $152- $152 billion.
U.S. regulators have asked nine major insurance companies to provide information about how they set prices for homeowners’ coverage. insurance makes billionS and .
billionS.
and billionS. WOW AND YOU ALL WANTED JOE the PUBLIC TO HAVE Credit Scoring,,,……………………..RE: about the rights of the policyholders LOUD NOISES Dec 31, 2008, 4:43 pm
RE: RE: RE: IQ Chief Executive Officer of State Fa Brokette Dec 31, 2008, 12:38 pm
RE: we should all be adults try cutting and paste this in Dec 31, 2008, 10:11 am
RE: RE: IQ Chief Executive Officer of State Fa nobody important Dec 31, 2008, Dec 31, 2008, 10:05 am
about the rights of the policyholders nobody important Dec 31, 2008, 10:01 am
RE: RE: RE: a tool-WHAT PART TO YOU ALL NOT GET? SAY I CAN Dec 31, 2008, 9:58 am
RE: RE: a tool-WHAT PART TO YOU ALL NOT GET? notthing about this HUH!!! Dec 31, 2008, 9:55 am
RE: RE: o-with little federal oversight Buckeye Dec 31, 2008, 9:38 am
RE: o-with little federal oversight Brokette Dec 30, 2008, 9:30 pm
o-with little federal oversight federal oversight. Dec 30, 2008, 8:29 pm
RE: a tool LOOK IT UP- Dec 30, 2008, 3:44 pm
RE: no right to information about an investigation class of business.- Dec 30, 2008, 3:42 pm
RE: W -see court records and evidence in a consumer fraud ca keep secret Dec 30, 2008, 3:38 pm
W -see court records and evidence in a consumer fraud case t misconduct. Dec 30, 2008, 3:33 pm
RE: To: Greg – Dec 29 12:59 PM Greg Dec 30, 2008, 3:03 pm
RE: RE: What are predictive models? Buckeye Dec 30, 2008, 2:51 pm
RE: What are predictive models? nobody important Dec 30, 2008, 2:43 pm
What are predictive models? Buckeye Dec 30, 2008, 2:14 pm
RE: To: Greg – Dec 29 12:59 PM nobody important Dec 30, 2008, 1:23 pm
To: Greg – Dec 29 12:59 PM Lame Brain Dec 30, 2008, 12:34 pm
Discussion thread? Buckeye Dec 30, 2008, 11:39 am
RE: haha – illiterate fool – Leave the country nobody important Dec 30, 2008, 11:32 am
haha – illiterate fool – Leave the country Mark Dec 30, 2008, 10:23 am
RE: IN SALT-LAKE nobody important Dec 30, 2008, 10:22 am
IN SALT-LAKE former in-house Dec 30, 2008, 10:16 am
RE: RE: RE: IQ Chief -WE CAN MAKE LAWS WORK FOR US BECAUSE W MAKE LAWS WORK FOR Dec 30, 2008, 10:09 am
RE: RE: RE: IQ Chief Executive Officer of State Fa Brokette Dec 30, 2008, 10:06 am
RE: RE: IQ Chief Executive – IS THAT SO BILL]. Don Quixote Dec 30, 2008, 10:02 am
RE: RE: IQ Chief Executive – IS THAT SO BILL]. Jake Dec 30, 2008, 10:01 am
RE: IQ Chief Executive – IS THAT SO BILL]. !A HAVE DONE NOTHING ABOUT ! Dec 30, 2008, 9:55 am
RE: RE: IQ Chief Executive on their financial strength Dec 30, 2008, 9:33 am
IQ Chief Executive Officer of State Fa Bill Dec 30, 2008, 9:33 am
RE: RE: IQ Chief Executive Officer of State Fa Two former in-house attorneys Dec 30, 2008, 9:22 am
Loud Noises Buckeye Dec 30, 2008, 7:31 am
not criminals – just a idiots in the insurance Dec 29, 2008, 8:56 pm
RE: to: greg ANGER Dec 29, 2008, 6:51 pm
RE: RE: – Its pretty simple They are not criminals – just a loco in la cabesa Dec 29, 2008, 6:35 pm
RE: RE: RE: from a great book!! Dec 29, 2008, 6:16 pm
RE: RE: RE: to: greg insguru Dec 29, 2008, 6:05 pm
RE: yourself about a subject.-thats the only way nobody important Dec 29, 2008, 3:38 pm
yourself about a subject.-thats the only way Dec 29, 2008, 3:10 pm
RE: you would not known the court has all of this….. watching these tapes Dec 29, 2008, 3:07 pm
RE: RE: RE: Nobody important is nobody smart nobody important Dec 29, 2008, 2:44 pm
RE: RE: Nobody important is nobody smart Delicious Pastries Dec 29, 2008, 2:32 pm
RE: Nobody important is nobody smart nobody important Dec 29, 2008, 1:26 pm
RE: RE: RE: to: greg nobody important Dec 29, 2008, 1:22 pm
RE: RE: from a great book!! nobody important Dec 29, 2008, 1:19 pm
RE: from a great book!! privileged?” Dec 29, 2008, 1:09 pm
RE: RE: To: Lame Brain Greg Dec 29, 2008, 12:59 pm
Nobody Important and Lame Brain Greg Dec 29, 2008, 12:55 pm
from a great book!! Dec 29, 2008, 12:51 pm
to: brokette Lame Brain Dec 29, 2008, 12:29 pm
Nobody important is nobody smart Darren Dec 29, 2008, 12:26 pm
RE: RE: to: greg Lame Brain Dec 29, 2008, 12:26 pm
RE: RE: RE: IQ rather than Credit – Correction Greg Dec 29, 2008, 12:16 pm
RE: RE: to: greg Brokette Dec 29, 2008, 12:15 pm
RE: to: greg nobody important Dec 29, 2008, 12:11 pm
RE: RE: IQ rather than Credit Greg Dec 29, 2008, 12:10 pm
RE: To: Lame Brain Lame Brain Dec 29, 2008, 12:10 pm
to: greg Lame Brain Dec 29, 2008, 11:57 am
To: Lame Brain Greg Dec 29, 2008, 11:48 am
RE: IQ rather than Credit Lame Brain Dec 29, 2008, 11:22 am
RE: IQ Chief Executive Officer of State Fa have them complete IQ tests Dec 29, 2008, 10:43 am
IQ rather than Credit Interesting Study Dec 29, 2008, 10:41 am
Scoring – Insuranceblame the govt and the banks. THE BIG CEO$$$ Dec 29, 2008, 10:39 am
RE: Credit Scoring and Insurance Greg Dec 29, 2008, 10:29 am
government to help it remain in business. loans Dec 29, 2008, 10:20 am
Credit Scoring and Insurance Average consumer Dec 29, 2008, 10:15 am
no right to information about an investigation policyholders have no right ,S Dec 29, 2008, 9:47 am
RE: To: National News • December 23, 2 nobody important Dec 29, 2008, 9:39 am
RE: a tool nobody important Dec 29, 2008, 9:38 am
To: National News • December 23, 2 Greg Dec 29, 2008, 9:37 am
a tool for Brokette Dec 29, 2008, 9:32 am
Hey Einstein Greg Dec 29, 2008, 9:28 am
Remeber the hey days One Dec 29, 2008, 9:23 am
repeal insurers anti trust exemption Fair Game Dec 29, 2008, 9:18 am
RE: RE: Abe 3:06 Brokette Dec 29, 2008, 9:17 am
RE: RE: RE: RE: Let’s use some logic in deciding the rules. Jr. said Dec 29, 2008, 9:15 am
RE: – Its pretty simple They are not criminals – just a lit Hope Dec 29, 2008, 8:58 am
RE: Abe 3:06 cheli Dec 29, 2008, 8:03 am
RE: CHELI 2:47 cheli Dec 29, 2008, 7:59 am
we should all be adults Pay more attention Dec 29, 2008, 2:17 am
– Its pretty simple They are not criminals – just a little Here is something I know Dec 29, 2008, 1:47 am
RE: RE: RE: TO Confidence led upright. You believed in honor experience says – – – Dec 29, 2008, 1:18 am
RE: RE: TO Confidence led upright. You believed in honor, an Peon Agent Dec 28, 2008, 9:14 pm
RE: TO Confidence led upright. You believed in honor, and th MELANIE Dec 28, 2008, 7:56 pm
TO BOB KOCHAN. from ‘ Randy DOWN Dec 28, 2008, 7:51 pm
RE: Interesting……point non-regulated world. Dec 28, 2008, 5:49 pm
RE: RE: RE: RE: RE: RE: @companies ask choice point to use f Einstein Dec 28, 2008, 10:29 am
RE: @companies ask choice point to use for them specifically National News • December 23, 2 Dec 27, 2008, 9:00 pm
RE: RE: RE: RE: @companies ask choice point to use for them On The Fox Dec 27, 2008, 8:50 pm
RE: RE: RE: @companies ask choice point to use for them spec insguru Dec 27, 2008, 3:47 pm
RE: RE: RE: RE: Are you kidding me insguru Dec 27, 2008, 3:46 pm
RE: RE: @companies ask choice point to use for them specific nobody important Dec 27, 2008, 3:24 pm
RE: RE: RE: RE: RE: @companies ask choice point to use for t insguru Dec 27, 2008, 3:09 pm
RE: RE: RE: RE: @companies ask choice point to use for them Peon Agent Dec 27, 2008, 1:31 pm
RE: RE: RE: @companies ask choice point to use for them spec insguru Dec 27, 2008, 12:24 pm
RE: RE: @companies ask choice point to use for them specific let me help you. Dec 27, 2008, 10:23 am
RE: RE: @companies ask choice point to use for them specific point Dec 27, 2008, 10:21 am
RE: @companies ask choice point to use for them specifically insguru Dec 27, 2008, 9:43 am
@companies ask choice point to use for them specifically. Melanie Dec 26, 2008, 8:59 pm
RE: RE: RE: RE: RE: Credit Scoring insguru Dec 26, 2008, 7:16 pm
RE: RE: RE: FTC Probing Insurers Over Credit-based Homeowner Greg Dec 26, 2008, 2:26 pm
RE: RE: RE: RE: RE: RE: RE: Credit Scoring Greg Dec 26, 2008, 1:54 pm
RE: RE: RE: FTC Probing Insurers Over Credit-based Homeowner SWFL Agent Dec 26, 2008, 1:50 pm
RE: RE: FTC Probing Insurers Over Credit-based Homeowners In InsIsMyPassion Dec 26, 2008, 12:00 pm
RE: RE: RE: RE: RE: RE: Credit Scoring No Way Dec 26, 2008, 11:36 am
RE: RE: RE: RE: RE: Credit Scoring Greg Dec 26, 2008, 10:29 am
RE: FTC Probing Insurers Over Credit-based Homeowners Insura Greg Dec 26, 2008, 10:25 am
RE: RE: RE: RE: Credit Scoring RateAdequacy Dec 26, 2008, 10:19 am
RE: RE: RE: Credit Scoring Greg Dec 26, 2008, 9:36 am
RE: RE: RE: RE: RE: staffman – Its pretty simple Santa Clause Dec 24, 2008, 2:34 pm
RE: RE: To Old Ins Guy & Peon Agent Brokette Dec 24, 2008, 11:41 am
RE: To Old Ins Guy & Peon Agent Peon Agent Dec 24, 2008, 11:30 am
RE: RE: RE: RE: RE: staffman – Its pretty simple Peon Agent Dec 24, 2008, 11:27 am
To Old Ins Guy & Peon Agent Brokette Dec 24, 2008, 11:21 am
RE: RE: RE: RE: staffman – Its pretty simple Actuary Dec 24, 2008, 10:59 am
RE: RE: Auto Notification – Mike & Jake Peon Agent Dec 24, 2008, 10:35 am
RE: RE: RE: RE: staffman – Its pretty simple staffman Dec 24, 2008, 10:31 am
RE: RE: RE: staffman – Its pretty simple Mike Dec 24, 2008, 10:26 am
RE: RE: staffman – Its pretty simple staffman Dec 24, 2008, 10:19 am
RE: RE: Auto Notification – Mike & Jake Old Ins Guy Dec 24, 2008, 10:06 am
RE: Auto Notification – Mike & Jake Brokette Dec 24, 2008, 10:02 am
RE: RE: staffman – Its pretty simple – Idiot!!!! Ralph Dec 24, 2008, 9:33 am
RE: staffman – Its pretty simple Bob Dec 24, 2008, 9:25 am
staffman – Its pretty simple Mike Dec 24, 2008, 9:23 am
Income issue staffman Dec 24, 2008, 9:14 am
RE: Auto Notification Jake Dec 24, 2008, 9:13 am
Auto Notification Mike Dec 24, 2008, 9:12 am
RE: RE: RE: Let’s use some logic in deciding the rules. Juliet Dec 24, 2008, 9:10 am
RE: RE: Let’s use some logic in deciding the rules. Obama Gurl Dec 24, 2008, 8:52 am
RE: Let’s use some logic in deciding the rules. Obama Gurl Dec 24, 2008, 7:54 am
Let’s use some logic in deciding the rules. Democratic Logic Dec 24, 2008, 7:43 am
RE: RE: Why I do not accept the – Dar 6:23 nobody important Dec 24, 2008, 7:04 am
To please……please!! Buckeye Dec 24, 2008, 6:15 am
RE: RE: Why I do not accept the – Dar 6:23 EGoyle Dec 23, 2008, 9:03 pm
RE: Why I do not accept the – Dar 6:23 Brokette Dec 23, 2008, 6:50 pm
Why I do not accept the “Credit Scoring” studies DarNovak Dec 23, 2008, 6:23 pm
RE: Why I do not accept EGoyle Dec 23, 2008, 6:08 pm
Why I do not accept “Ccredit Scoring” DarNovak Dec 23, 2008, 5:53 pm
RE: RE: RE: RE: RE: Are you kidding me – Mike 3:50 Seriously Dec 23, 2008, 5:21 pm
RE: RE: RE: Are you kidding me – Mark 3:34 LOL – Right Dec 23, 2008, 5:15 pm
RE: standardized score EGoyle Dec 23, 2008, 5:09 pm
RE: RE: RE: RE: Are you kidding me – Mike 3:50 Brokette Dec 23, 2008, 5:08 pm
standardized score nick Dec 23, 2008, 4:41 pm
RE: RE: Are you kidding me (Rick) Mark Dec 23, 2008, 4:06 pm
RE: RE: RE: Are you kidding me Mike Dec 23, 2008, 3:50 pm
RE: RE: Are you kidding me Mark Dec 23, 2008, 3:44 pm
RE: RE: Are you kidding me – Nope Insurance Man Dec 23, 2008, 3:43 pm
RE: Are you kidding me Rick Dec 23, 2008, 3:38 pm
RE: Are you kidding me – Nope Abe Dec 23, 2008, 3:37 pm
Are you kidding me Insurance Man Dec 23, 2008, 3:31 pm
Wow Peon Agent Dec 23, 2008, 3:31 pm
RE: FDA & The Drug Companies Matt Dec 23, 2008, 3:28 pm
RE: RE: RE: RE: Hey Brook? Will you take this bet? Mike Dec 23, 2008, 3:22 pm
FDA & The Drug Companies One Who Doesn’t Get It Dec 23, 2008, 3:20 pm
In with the new and out with the evil old ones Waiting on Obama to take over Dec 23, 2008, 3:19 pm
RE: RE: RE: Hey Brook? Will you take this bet? Brokette Dec 23, 2008, 3:17 pm
RE: RE: RE: Common Sense joe Dec 23, 2008, 3:15 pm
Abe 3:06 Rick Dec 23, 2008, 3:14 pm
Peon Agent?? I don think so… Mike Dec 23, 2008, 3:13 pm
RE: RE: Common Sense Peon Agent Dec 23, 2008, 3:09 pm
RE: RE: RE: Hey Brook? Will you take this bet? Abe Dec 23, 2008, 3:06 pm
RE: RE: Hey Brook? Will you take this bet? Doug Dec 23, 2008, 3:05 pm
CHELI 2:47 Rick Dec 23, 2008, 3:01 pm
RE: Vegans vs meat eaters joe Dec 23, 2008, 2:51 pm
RE: InsMgmt 2:13 CHELI Dec 23, 2008, 2:47 pm
RE: Hey Brook? Will you take this bet? Brokette Dec 23, 2008, 2:45 pm
Vegans vs meat eaters We try not to write vegans Dec 23, 2008, 2:44 pm
InsMgmt 2:13 Rick Dec 23, 2008, 2:44 pm
RE: RE: Hey Brook? Will you take this bet? Doug Dec 23, 2008, 2:39 pm
RE: Hey Brook? Will you take this bet? CHELI Dec 23, 2008, 2:37 pm
RE: RE: Common Sense joe Dec 23, 2008, 2:36 pm
RE: RE: Compassion? Brook Dec 23, 2008, 2:35 pm
Hey Brook? Will you take this bet? Mike Dec 23, 2008, 2:33 pm
RE: Compassion? Brokette Dec 23, 2008, 2:30 pm
RE: RE: SOCIALIZED INSURANCE brad Dec 23, 2008, 2:28 pm
Compassion? Actuary Dec 23, 2008, 2:28 pm
Rates are like water… Vlad Dec 23, 2008, 2:27 pm
RE: RE: RE: Common Sense – Jake 2:19 Brokette Dec 23, 2008, 2:26 pm
RE: RE: RE: Common Sense – Rachel 2:11 CHELI Dec 23, 2008, 2:24 pm
RE: RE: Common Sense – Rachel 2:11 Brokette Dec 23, 2008, 2:23 pm
RE: RE: RE: Common Sense CHELI Dec 23, 2008, 2:21 pm
RE: RE: Common Sense Jake Dec 23, 2008, 2:19 pm
RE: RE: Common Sense – Joe Doug Dec 23, 2008, 2:16 pm
RE: Common Sense joe Dec 23, 2008, 2:14 pm
RE: Credit Scoring CHELI Dec 23, 2008, 2:14 pm
Rick 1:41 InsMgmt Dec 23, 2008, 2:13 pm
RE: Govt Assessable Mutual Insurance Stat Guy Dec 23, 2008, 2:12 pm
RE: Common Sense Rachel Dec 23, 2008, 2:11 pm
RE: RE: SOCIALIZED INSURANCE Brokette Dec 23, 2008, 2:10 pm
RE: RE: In Texas Whitey pays same as others including Obama Stat Guy Dec 23, 2008, 2:06 pm
Common Sense Ralph Dec 23, 2008, 2:05 pm
RE: SOCIALIZED INSURANCE Porfirio Dec 23, 2008, 2:01 pm
RE: experience says – – – Mrs Dean Wormer Dec 23, 2008, 1:58 pm
RE: RE: RE: Interesting……how it’s supposed to work.. Stat Guy Dec 23, 2008, 1:57 pm
Lets do a study on NASCAR Ricky Rud Dec 23, 2008, 1:53 pm
RE: SOCIALIZED INSURANCE brad Dec 23, 2008, 1:48 pm
RE: Govt Assessable Mutual Insurance brad Dec 23, 2008, 1:45 pm
SOCIALIZED INSURANCE NEVER FEAR THE OBAMA IS HERE Dec 23, 2008, 1:43 pm
InsMgmt 1:15 Rick Dec 23, 2008, 1:41 pm
RE: Pat 11:41 Pat Beranger Dec 23, 2008, 1:40 pm
RE: Good Posts Bill Dec 23, 2008, 1:37 pm
RE: Scoring – cd 1:12 Ratemaker Dec 23, 2008, 1:32 pm
To Please Bill Dec 23, 2008, 1:32 pm
Bob 12:49 InsMgmt Dec 23, 2008, 1:26 pm
RE: RE: RE: Govt Assessable Mutual Insurance ins product manager Dec 23, 2008, 1:25 pm
FTC Probing Insurers Over Credit-based Homeowners Insurance RolfNeu Dec 23, 2008, 1:25 pm
to please….. Bob Dec 23, 2008, 1:23 pm
Sick of race card Bill Dec 23, 2008, 1:22 pm
Pat 11:41 InsMgmt Dec 23, 2008, 1:17 pm
George 11:28 InsMgmt Dec 23, 2008, 1:15 pm
Rick 11:32 InsMgmt Dec 23, 2008, 1:13 pm
Scoring cd Dec 23, 2008, 1:12 pm
Curious 12:49 Hawk Dec 23, 2008, 1:11 pm
RE: RE: Govt Assessable Mutual Insurance staffman Dec 23, 2008, 1:07 pm
Good Posts Ray Dec 23, 2008, 1:06 pm
fact…. m & m Dec 23, 2008, 1:03 pm
RE: Govt Assessable Mutual Insurance The Soprano Family Dec 23, 2008, 12:54 pm
sam the claims guy Rick Dec 23, 2008, 12:52 pm
Govt Assessable Mutual Insurance ins product manager Dec 23, 2008, 12:51 pm
RE: RE: Credit Scoring Curious Dec 23, 2008, 12:49 pm
To InsMgmt Bob Dec 23, 2008, 12:49 pm
Credit Scoring Dec 23, 2008, 12:46 pm
RE: Obama is going to fix this. Hope & Change Be A Coming! Dec 23, 2008, 12:44 pm
RE: Credit Scoring Texas Dec 23, 2008, 12:43 pm
RE: RE: RE: In Texas Whitey pays same as others including Ob Glennie Dec 23, 2008, 12:32 pm
experience says – – – sam the claims guy Dec 23, 2008, 12:22 pm
RE: RE: In Texas Whitey pays same as others including Obama please….. Dec 23, 2008, 12:20 pm
RE: In Texas Whitey pays same as others including Obama Jack J Maniscalco Dec 23, 2008, 12:18 pm
RE: Credit Scoring company gal Dec 23, 2008, 12:16 pm
In Texas Whitey pays same as others including Obama Texas Agent Dec 23, 2008, 12:03 pm
RE: Credit Scoring nobody important Dec 23, 2008, 12:02 pm
RE: Law-yer. 11:24 Ned Dec 23, 2008, 11:58 am
RE: RE: Obama is going to fix this. Barack Obama Dec 23, 2008, 11:57 am
RE: Obama is going to fix this. glennie Dec 23, 2008, 11:56 am
Obama is going to fix this. Obama’s gonna fix all this! Dec 23, 2008, 11:54 am
Credit Scoring John Q. Agent Dec 23, 2008, 11:49 am
RE: Credit Scoring
You cut and paste morons aren’t even bright enough to come up with your own name. Figures.
Well said, Brokette. An insurance policy is a contract entered into by two parties for consideration in the form of premium. In many instances, the transaction is facilitated by a professional third party called an agent.
It is very simple — claims are either adjusted in accordance with the contract or they are not. If they are not, then the policyholder has legal recourse against the insurance carrier. If a professional third party (i.e. agent) was involved in the transaction, then the policyholder should have additional leverage and support from said professional third party.
As previously stated, the insurance carrier hate, conspiracy theories and illogical emotion are unproductive and ludicrous. Insurance carriers are obligated to take responsibiliy for the contracts they enter into. If they violate the contract, then they are held accountable. What far too many people (including many so-called insurance professionals posting on this site) tend to forget is that policyholders are assumed to be a responsible party entering into the same contract. The contractual nature of the insurance policy is intended to protect the interests of the policyholder. If the policyholder acts in an irresponsible manner when he/she enters into the contract (e.g. not paying attention to terms and conditions or simply purchasing the cheapest product in lieu of the desired or necessary coverage in the event of loss), then the policyholder will find himself/herself in the unfortunate position of being held accountable for acting in an irresponsible manner.
WHAT PART TO YOU ALL NOT GET?
LOOK IT UP.
http://www.clarionledger.com/assets/pdf/D069388410.PDF
MY DEAR FRIEND IS WHY THIS COUNTY IS IN THE HUGH MISS – IT,S -IN . KNOW ONE WANTS TO STEP UP TO THE PLATE WHAT A SICK DIAGNOSE .WAKE UP – PLEASE IT,S TIME.
. 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- .
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.
http://www.marrlawfirm.com/files/Sun%20Herald%209-21-06%20SF%20Haag.pdf
“Two former in-house attorneys for State Farm contend that they were often called upon…”
I wonder how many times is “often” and did these attorneys admit to this unethical behavior only after they’d been caught red-handed in the course of policyholder bad faith litigation? If refusing to engage in illegal/unethical behavior costs me my job, so be it. Apparently, these attorneys possess no such “convictions”. Double entendre intended.
So I see that the insurance scoring forum has now turned into a “let’s rant and rave about any non-sensical subject we can” OR, my personal favorite “let’s just plain put each other down because we can’t come up with anything intelligent to say” Here’s food for a thought – how old is everyone on here?? Just curious???
I think that as professionals we should realize that we should always help trained people to look at the[ big picture] .
Agreed. I think what most insurance professionals object to is a bunch of politically correct buffoons who’ve had zero executive experience sticking their lobbyist bribe soaked hands in our business. Our business does NOT have anything close to a monopoly so the insurance haters need to stop posting as if they have no choice, shop their insurance and take some responsibility for their lives. Stop pretending your homeowner’s carrier is holding you hostage (no matter how they underwrite and price their product). Maybe if you’d take more interest in the terms of your insurance policy than your iPod, you’d have good coverage at a fair price, but you don’t do that, do you?
I think you have it backwards. The lobbyists are working much more for the benefits of the insurance companies, and that my dear is fact. I’m not sure where you get the idea that lobbyists are benefiting the consumer when they work directly for the insurance giants. You recommend that we stop pretending that our homeowner’s insurance is holding us hostage. What else would you call it when you pay insurance premiums for years and when disaster strikes you are lucky if you get 25 cents on the dollar? Do you think the mortgage companies care that now your home is basically worthless and you still have the balance to pay off? People believe the commercials that they see on TV and that’s why companies use words like “good neighor” “good hands” “American” “Family” etc. These companies spend billions of dollars telling us how great they are and billions in court not paying what the policy provisions say they will pay. Why not just pay the claims and save the advertising and legal fees? Can you imagine what THAT would do for the world? You know that top attornies write these policies and there are other top attornies that try to interpret them and still don’t know what they are saying. If you look up some of the terms in the dictionary you will find that the dictionary says one thing and the insurance world means another. I have posted records that are open for you to look up and verify these facts yourself. There are court documents all over this country that will tell you that there is something wrong with your industry. I do not hate your industry. What I hate is the injustice and the insanity because it is the Mom’s and Pop’s of this world that pay for this nonsense. I don’t know about you but for this New Year this little light of mine will shine and we shall overcome. Some seeds will fall on fertile ground and some will not. With the poor I will cast my lot!
IT,S A MESSAGE OF TOLERANCE
Comment:
One of your comments was “I apologize that my product doesn’t function like welfare OR therapy, sir.” You can call me DEAR it’s okay. Welfare? Wow, this is not good therapy. I DO NOT KNOW ABOUT YOU BUT WE ALL PAY YEAR AFTER YEAR FOR YOUR so called welfare TO YOUR CEO’S. THE MILLONS BEING PAID TO THE TOP CEO’S represent corporate welfare that the poor are paying for. AS FOR IGNORANCE, if you think insurance company lobbyists are the ones who are responsible for the attorneys acting unethically–well, I can only assume you don’t understand the lobbying process’ A NEW YEAR– HOW MUCH CLOSER ARE WE TO THE ENLIGHTENMENT THAT WOULD TAKE US BEYOND SUCH BEHAVIOR.
KNOW ONE ON THIS PLANT IS WORT
Comment:
Willumstad earlier waived a $22.5 million severance payment that he would have been due, This my friend is where the problem lies. KNOW ONE ON THIS PLANT IS WORTH $22.5 million . THIS IS THE Writing on the Wall.THE TOP CEO’S represent corporate welfare that the poor are paying for. AS FOR IGNORANCE, if you think insurance company lobbyists are the ones who are responsible for the attorneys acting unethically–well, I can only assume you don’t understand the lobbying process’ A NEW YEAR– HOW MUCH CLOSER ARE WE TO THE ENLIGHTENMENT THAT WOULD TAKE US BEYOND SUCH BEHAVIOR. – IT,S A MESSAGE .
As a noted feminist once said, “I am NOT your dear.” Since you are clearly outside of the insurance industry, I wouldn’t expect you to understand its purpose. As our society has become increasingly socialist (let’s please stipulate to that as arguing the point will only make you look ignorant), we’ve come to expect insurance to function like welfare so no one (especially the sainted poor) would have to suffer ANY kind of loss, monetary or emotional. Well, I apologize that my product doesn’t function like welfare OR therapy, sir. It is, by definition, designed to put the policyholder back in the same place they were prior to the loss. If they lived in a dilapidated 100 year old shanty, that’s what they get. There is no doubt that the insurance industry has some bad actors, just like all industries and just like the government. I’ll bet “Hot” Rod Blagojevich cares nothing for the sainted poor folks. He plays the part (like you do) and hopes for redemption. And if you think insurance company lobbyists are the ones who are responsible for the attorneys acting unethically–well, I can only assume you don’t understand the lobbying process. See lobbyists go to POLITICIANS and buy their votes. Oh, and by the way, I would submit that (like California) whenever the populace gets the opportunity to elect an insurance commissioner they vote for the guy (or “gal”, to use your vernacular) who promises to “stick it” to the insurance companies. Wherever there’s a contract (insurance policy), there will always be disputes. Just think how many attorneys we’d need if there weren’t.
One of your comments was “I apologize that my product doesn’t function like welfare OR therapy, sir.” You can call me DEAR it’s okay. Welfare? Wow, this is not good therapy. I DO NOT KNOW ABOUT YOU BUT WE ALL PAY YEAR AFTER YEAR FOR YOUR so called welfare TO YOUR CEO’S. THE MILLONS BEING PAID TO THE TOP CEO’S represent corporate welfare that the poor are paying for. AS FOR IGNORANCE, if you think insurance company lobbyists are the ones who are responsible for the attorneys acting unethically–well, I can only assume you don’t understand the lobbying process’ A NEW YEAR– HOW MUCH CLOSER ARE WE TO THE ENLIGHTENMENT THAT WOULD TAKE US BEYOND SUCH BEHAVIOR.
So just curious – when did the abbreviation for Florida become FA?? OR is it a new state like Florida and Iowa combined???
IT’S NOT A CREDIT SCORE – GET IT??? HOW MANY TIMES DO WE HAVE TO SAY IT SO THAT YOU GET IT???????
It’s about time Insurance companies were forced to actually hold up their end of the contract. They’re much better at collecting premiums than at paying legitimate costs associated with losses.
I am convinced that my policies are designed so that I will never be covered for what I think I am.
Once again this industry proves they are unable to act ethically.I hope these guys have to pay billions in restitution. In fact I would go a step further and put the CEO’s and Corporate officer’s in prison.Why are we legally forced to buy insurance which is totally useless?
THIS IS WHAT PEOPLE THINK ABOUT AND TALK ABOUT. http://www.clarionledger.com/assets/pdf/D069388410.PDF
We should be using this website as a tool to gain more knowledge about our industry to do our job better. Pay more attention to what they are trying to say.
I submit that in very few instances are we legally obligated to buy insurance. We are legally obligated to prove we can meet certain financial responsibilities to third parties i.e. your mortgage holder, people you damage or injure while driving a car. However, most laws provide for an alternate method of meeting these financial responsibilities. Bonds can be posted, fiduciary accounts established, et al. You’re not required to purchase a homeowner’s policy–buy a dwelling fire policy and pay less to the dirty rotten insurance companies. Then when your house is destroyed you can replace your own personal belongings. When policyholders say things like, “I had to inflate my claim to recover my deductible” or “I had to hose down the rest of my carpet to get it all replaced”, one doesn’t have to wonder why insurance companies are cautious in their investigation of claims. You might think this is justified because “insurance companies never pay claims” but the truth is that these types of policyholders make the insurance company less likely to believe YOU when a loss occurs. Maybe you should direct your hate toward the perpetrators of fraud. Personally, I don’t appreciate being judged by the lowest common denominator at all.
HAHAHAHAHA! Clearly you haven’t been reading the Forbes Top 100 of Highly Paid CEO’s. If you had, you’d know that Insurance Company CEO’s RARELY make the list. Order the back issues of Forbes for reference. And if an insurance company is such a profitable enterprise, why aren’t their shares trading at higher prices? Hmmmm.
I continue to suggest the revolutionary act of reading an insurance policy. Peoples’ unrealistic expectations of its purpose typically leads to their discontent with a policy’s benefits.
HEADLINE:State Farm Claims Actions Under Fire: Use of Biased Reporting Found
By Anita Lee, The Sun Herald, Biloxi, Miss.
Nov. 16–As instructed, State Farm catastrophe manager Alexis “Lecky” King refused to answer questions an Oklahoma attorney fired at her for one hour and 10 minutes.
Instead, she repeated the same phrase 87 times: “Because of the ongoing state and federal investigation, on advice of counsel, at this time, I must invoke my constitutional right to remain silent.”
[She would not tell the attorney why State Farm ordered a second damage report on property when the first showed a policyholder’s losses were covered]. Nor was she willing to discuss why State Farm went with that second report, finding little or no covered damage.
It happened after an Oklahoma tornado and, records show, on the Mississippi Coast after Hurricane Katrina.
“Do you believe as a team manager — catastrophe team manager — that you owe any of either the policyholders in Oklahoma who endured their catastrophe of May 1999 or the policyholders who suffered losses in Katrina any type of apology?” asked the Oklahoma policyholders’ attorney, Jeff D. Marr.
Same answer.
“Can you tell myself and this jury what it will take, what the next jury in January, or any juries down in the Gulf Coast states need to do in order to ensure that State Farm stops this kind of behavior?” Marr asked.
State Farm’s attorney objected to the question.
It didn’t matter. King feared answers might incriminate her because she is the target of a state grand jury investigation in Mississippi regarding the insurance industry’s claims practices after Katrina. She was even unwilling to say what route she took to reach the Nov. 3 meeting in Pensacola, Fla., where she lives.
The Oklahoma Supreme Court compelled King, along with State Farm executives from Bloomington, Ill., headquarters, to submit under oath to Marr’s questions.
An Oklahoma jury in May found that State Farm “recklessly disregarded” its duty to deal fairly with policyholders, doing so “intentionally and with malice” through the use of biased expert opinions after the 1999 tornado. The tornado, one of many to strike May 3, 1999, reached a strength of F5, the most catastrophic on the Fujita scale.
As a result, the first of Marr’s tornado clients collected $13 million in damages. Marr hopes to show State Farm’s behavior continued in Mississippi. By doing so, he could secure higher damages for 70 more members of his class-action lawsuit in Oklahoma.
State Farm issued a statement Friday in response to Sun Herald questions about the legal activity: “The tornado that struck Oklahoma City in 1999 and Hurricane Katrina are two separate events,” the company said. “We handle claims individually and pay what we owe based on the contract with the policyholder.”
Marr is sharing information with Mississippi attorneys representing hundreds of State Farm policyholders whose homes Hurricane Katrina damaged or destroyed.
He also is sharing information with the Mississippi attorney general, who has convened the grand jury investigation, and with the U.S. Justice Department, which has launched a probe of its own.
In fact, Marr has announced to the world on his Web site, http://www.marrlawfirm.com., where to secure court records about State Farm.
State Farm attorneys have fought to keep employee testimony private in Oklahoma and Mississippi. In fact, at State Farm’s request, an Oklahoma judge has forbade further discussion of the case by Marr and the other attorneys. State Farm is using court protections and procedures, the company said, available to all parties in a lawsuit.
As cases in both states grind forward, more information comes to light.
Executives for the nation’s largest property and casualty insurer deny any intentional misconduct. They said the company worked with nationally recognized engineering firms to help determine what policyholders were owed in less than 2 percent of 84,000 Katrina claims in Mississippi.
In sworn testimony this summer in Oklahoma, company chairman and CEO Edward B. Rust Jr. said: “And that is ultimately my concern, also, is that we want to be fair with our customers. After all, the success of this organization is driven by our ability to retain current customers and to attract new customers. The last thing we want to do is be unfair with our customers.”
Rust has not testified in Mississippi, but Lecky King did. Her testimony in a federal lawsuit filed in Gulfport is under wraps on orders from U.S. Magistrate Judge Robert H. Walker. Attorneys can’t discuss what she did or did not say.
Two State Farm whistleblowers said, King and assistant Lisa Wachter were the only employees in the Coast office allowed to communicate with engineering firms the company used to help sort out what State Farm owed some policyholders after Katrina. Normally, the whistleblowers have said, State Farm adjusters communicated directly with engineering firms.
When a report blamed the covered peril of wind for damage, the whistleblowers said, King ordered another to show the culprit was water, covered by the federal flood insurance program. The company finally called a halt to the reports altogether, the whistleblowers said, because too many showed wind damage.
Joe Hollomon, once a federal prosecutor himself, said his clients, King and Wachter, had nothing to gain by denying claims and were here to help policyholders. In Oklahoma, King’s testimony is a matter of public record, but the attorneys are not allowed to hand it out.
Hollomon told Marr before the questions started: “Obviously, we’re, you know, that’s a matter of concern to myself and my client. She’s going to assert her constitutional privilege and, of course, the dissemination of that could obviously prejudice her if we one day find ourselves in front of a jury somewhere in Mississippi, so, you know, we’re very concerned about that.”
——
State Farm engineering reports
Below are engineering reports recently filed as part of the Oklahoma lawsuit:
Larry Lowe residence, Oklahoma City
May 24, 1999: Strum Engineering, Oklahoma City, hired by State Farm, concluded high winds racked the roof, causing rafters to separate from the ridge, which could lead to leaks from rain and eventually create safety issues. Repairs recommended.
June 11, 1999: State Farm asked Haag Engineering to examine the house. Haag concluded in a report issued July 21: “It is our opinion that the Love (sic) residence was not structurally damaged by wind, and the frame requires no repairs.”
Michael and Lisa Pole property, Oklahoma City
July 19, 1999: Strider Associates, hired by the Poles, found tornado damage to roof framing, decking and brick veneer, all requiring replacement.
July 27, 1999: A State Farm claims representative makes note of the Strider report and repairs recommended, then concluded, “I believe we should hire a structural engineer to inspect and provide us with their expert opinion.”
Aug. 18, 1999: Inspecting for State Farm,Haag Engineering concluded, “The primary structural system of the Pole residence had not been damaged by wind.” Wind damaged only a few roof shingles, the report says.
Terri Mullins property, Kiln, Miss.
Oct. 23, 2005: Forensic Analysis & Engineering Corp., hired by State Farm, concluded “the primary and predominant cause of damage to the subject property was due to hurricane force winds. This is based on the displacement of the house and the absence of water damage to the same.”
Jan. 3, 2006: A second Forensic Analysis report says wind caused “tree failures,” the cause of interior damage is undetermined and that “movement of the house across the street with “minimal obvious wind damage is consistent with a buoyant force applied to the building by rising water allowing the wind to blow the house northwards until it reached an obstruction.” (State Farm interprets its policies to say wind damage is not covered when water contributes.)
Thomas and Pamela McIntosh property, Biloxi
Oct. 12, 2005: Forensic Analysis & Engineering Corp. concluded roof, door, carport and window damage was caused by wind, along with interior damage. The report State Farm ordered included a sticky note on the first page that said, “Put in Wind file — DO NOT Pay Bill, DO NOT discuss.”
Oct. 20, 2005: Forensic concluded wind damaged shingles, along with the second story floor and first floor ceilings, but said “damage to first floor walls and floors appears to be predominately caused by rising water.”
State Farm issued the following statement Friday regarding its handling of policyholder claims. It reads, in part:
“The tornado that struck Oklahoma City in 1999 and Hurricane Katrina are two separate events. We handle claims individually and pay what we owe based on the contract with the policyholder.
“State Farm occasionally seeks the help of nationally recognized engineering firms to assist us in determining the cause of loss.
“Following last year’s hurricanes, we sought assistance from these firms in less than 2 percent of the 84,000 claims filed in Mississippi. Katrina was an unprecedented event and in a small number of claims there was more than one engineering report due to multiple reasons.
“Our intent was to seek assistance to help us settle claims with our policyholders.”
—–
Copyright (c) 2006, The Sun Herald, Biloxi, Miss.
Distributed by McClatchy-Tribune Business News.
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Dec. 31–After the confetti settles from tonight’s New Year’s eve celebrations, Utahns will face a few changes as a dozen new state laws take effect.
One in particular, Sen. Sheldon Killpack’s SB149, mandates increased motor vehicle liability insurance coverage — from $50,000 to $65,000 — for bodily injury of two or more people.
As a result, premiums are expected to rise, but to what extent will vary according to carrier and type of coverage.
While those well-off likely won’t see much difference, the working poor will feel the pain and the ranks of the uninsured will increase, predicts Gary Thorup, an attorney for Property Casualty Insurance Association of America.
“There are currently people who are marginally paying for their insurance,” Thorup said. “As those rates go up, obviously wallets will be stretched even further. If it’s the choice of feeding my family and taking the chance of being uninsured, I will probably opt for the first.”
The bill’s backers pushed for higher coverage requirements to pay for hefty medical costs incurred in serious accidents.
Paul McGarrell, an agent with Farmers Insurance, maintains that the bump to $65,000 does not go high enough.
“Medical bills being what they are, it’s still not a lot of coverage,” McGarrell said. “So when people are badly hurt, the bills can go way beyond that.”
However, as a company, Farmers Insurance lobbied against SB149.
“Farmers
opposed it because of the large number who drive uninsured,” McGarrell said. “They felt it would increase that number and that having some coverage is better than none.”
With the plummeting economy, people are shopping harder for rates, McGarrell added, and more are dropping collision and comprehensive coverage and opting for liability only.
The working poor will feel the pain and the ranks of the uninsured will increase.
The insurance industry needs to take a long, hard look at itself,” Spitzer said. “If the practices identified in our suit are as widespread as they appear to be, then the industry’s fundamental business model needs major corrective action and reform. There is simply no responsible argument for a system that rigs bids, stifles competition and cheats customers,” he added
John CommentS:
To add to the discussion, and respond to the one or two persons who posted what I perceived as unkind remarks earlier, what are you? Cold-hearted cynics? Or just terribly misinformed?
You certainly weren’t at the trial where the uncontradicted expert evidence was that hurricane force winds pounded the Kodrin home for HOURS before any flood waters touched it.
Even the defense expert had NO explanation for how the Kodrin home roof ended up 1000 feet across the road from the slab, having ended up in the same direction of earlier top-sustained winds, which arrived long BEFORE any significant flood waters arrived. And when significant flood waters did arrive, they may have only reached between TWO AND FIVE FEET up the walls of the Kodrin home, State Farm’s climatologist had to concede on cross-exam. And, once the flood waters did get deep enough to perhaps pose a threat – IF the home had still been standing at that point – the winds by then would have sent the roof at least 90 degrees in another direction (a virtual impossibility, we maintained).
But you didn’t know any of that, because you were not at the trial, as I was.
Re Burden of Proof – Under LA law, the burden is ALWAYS on the insurance company to prove the damaged or destroyed home is NOT covered and has the burden of proving why. But I hope you never have to have that debate as a devastated homeowner yourselves.
John W. Redmann, Attorney for the Kodrins
Subject Posted By Posted On
RE: RE: Burden of Proof – new policy forms John Redmann Nov 23, 2007, 2:36 pm
RE: Burden of Proof – new policy forms Kent Nov 12, 2007, 12:32 pm
RE: The Burden of Proof BEN BROKE Nov 8, 2007, 8:24 am
RE: The Burden of Proof Ol Man Of The Mountain Nov 7, 2007, 9:09 pm
Sad Realist Nov 7, 2007, 1:46 pm
RE: The Burden of Proof ad Nov 7, 2007, 1:33 pm
The Burden of Proof gg Nov 7, 2007, 1:06 pm
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Dear Mr. “take a hard look”, “investigation of claims”–blah, blah, blah:
You’re quoting a *****-monger??!? Someone who believed himself to be above the law or even above generally acceptable levels of human behavior? This is a joke, right? You’re really Bill Maher, aren’t you? Maybe you should take a meeting with someone in our industry like, say Warren Buffett–a man of unimpeachable integrity. And a political liberal–just so you can “feel” good about the source of information.
And way to re-direct the subject of fraud. Believe me, every insurance carrier who’s been proven to have committed illegal acts is taken to task in a big way. I’m sorry that you couldn’t get them to build you a mansion after your shanty was destroyed by Hurricane Katrina. That’s not what insurance is for. And you really should find something besides your tired old State Farm emails. That’s one insurance company. Let’s talk about some others. “You’re it!”
So now my question to you is: “When did owning a car or house become an entitlement of our system?” I had to work my butt off for YEARS to afford these things. In the interim, I lived in apartments or rented housing–took public transportation in a city of 500,000 that had no public transportation beyond a bus system. If MY insurance company was treating me this way, I’d surely file a report with our State DOI and find an attorney (there are millions of them) willing to take my case on contingency. I can assure you by the time it was all over my carrier would know the financial wrath that a bad faith suit can cause. I’m curious–why don’t you have any evidence of these problems occurring in the area of commercial insurance. Perhaps commercial insureds have a better understanding of the purpose of insurance while homeowner’s expect a mansion to replace their shanty. And why, exactly, does a dispute between wind and flood concern these folks? Oops! They didn’t buy flood insurance, did they? And therein lies the crux of the matter. They made a choice. They gambled and they lost. The chooser is accountable.
As a 10 year veteran of the catastrophe adjusting business, I’ve worked
on numerous State Farm projects, as well as for many other companies.
All with varying degrees of profit potential. What you’re about to read
is worth your time … trust me. It may save you from making a big
mistake.
We’ve all heard the horror stories which have been circulating for years
now, about how bad State Farm often treats it’s independent adjusters,
as well as their policy holders. To date, however, I’ve been mostly
spared the bad trips many other adjusters have experienced. I’ve made
money working for State Farm in the past, but it’s getting more and more
difficult, especially on a large CAT.
Now I have my own nightmare to add to the stories you’ve heard. By the
way, it’s true … they do behave like Nazi’s toward independents on
most of their projects, and care about as little for the independent
adjuster, as they do for their policy holders. For those who have worked
for what’s come to be known as Hitler’s “SF,” you know what I’m talking
about. The latest term I’ve heard to describe them in south Mississippi
is, “The Great Satan.” This is how angry people have become here.
This year I was begged, I mean literally begged by a certain
independent, to come and help them out on their hurricane Georges
operation in south Mississippi, because the adjuster before me had
ditched the storm. Fool that I was, I went to try and help out, only to
get the worst screwing I’ve gotten in a very long time.
To begin with, at least a third of the flood files I was given, required
underwriting reformation before a scope could be agreed to, or any
advances issued. This process was taking up to 30 days when I left. Keep
in mind, in many cases these are people out of their homes without
additional living expenses. Many were so upset, that they were either in
tears when I arrived, or furious that they couldn’t get any advance
money. Add to this the problem of closing these files. You can’t close a
flood claim that is being corrected for underwriting errors. You can’t
bill it either. We couldn’t even close our no claims, until what has
come to be known as “The Reformation” is completed on the policy.
When I asked one of their wealthy agents, who’s home I just happened to
be handling for minor flood damage, what an elevated structure was, the
agent admitted to me that she had no clue. And that she had not even
been to a seminar or workshop on the subject, because they were
inconveniently held out of town. Far from being an isolated case, there
are hundreds, possibly thousands of State Farm policy holders all across
the southern Gulf Coast, who are getting screwed more than they usually
do by State Farm, all because the company failed to properly school
and(or) test their agents on how to accurately file the underwriting on
a dwelling flood policy.
But the nightmare doesn’t end there, the poor people in many cases will
owe money when the underwriting errors are corrected, because they were
being undercharged on their coverage, for in some cases YEARS! Try
handling a claim where, because of the hurricane, the policy holder owes
the insurance company money!!! It’s the most negligent situation I’ve
ever encountered since I started adjusting. It wouldn’t surprise me to
see a class action lawsuit against them for this, if their isn’t one
already.
And get this, the policy holders all say that after they purchased their
policies, someone came out and inspected their homes in order to verify
the application. Makes you wonder who’s watching the store here.
Amazing how these hypocritical bastards will nickel and dime the poor
people to death, meticulously handling their disaster claims to
undeniable lean accuracy. Only to handle the underwriting with such a
disregard for correctness, as to cause a second catastrophe in the poor
people’s lives.
It’s as if someone owned a grocery store, who didn’t care to manage the
receipts for his wholesale inventory, but managed to death, the check
out clerks, the bagboys, and the customers for shoplifting concerns.
Going so far as to do body cavity searches of everyone who dares leave
the store with any merchandise, even though the goods are already paid
for.
What’s worse, when I arrived at the CAT two weeks after the storm, no
one informed me how bad things were, because all they were looking for
at that point were warm bodies to help control the dam break of
underwriting errors. Many of the adjusters before me had already fled
the situation.
Little did I know that the underwriting problems had created an
apparently dire legal or political situation, whereby we were told that
the storm office had to be closed by Thanksgiving. This created an extra
element of stress during the operation, that became a nightmare for me
personally. I have a hard time dealing with people who are angry for
good reason. It’s hard to put a value on your labor under those kinds of
circumstances, because you have to spend so much of your time hand
holding. Work like this should be billed at time and expense, or a daily
rate, it’s that simple.
Rumor is that the Mississippi State insurance commissioner has caught
wind of the big mishap, and is coming down hard on State Farm, forcing
them to rush their claims to completion. Keep in mind that you will
probably not be paid for the time and effort you put into the files you
cannot close before they are reassigned. This is common practice with
State Farm, stealing labor, and don’t kid yourself, the adjusting firms
you are working for don’t give a damn about you or your money, because
they will get theirs, regardless.
When I received my files, many of the insured’s were complaining that we
were the third and fourth adjuster who had contacted them. This was only
two weeks into the storm! Why, because it’s getting hard to find good
adjuster’s willing to be a part of the “SF.” They simply don’t pay
enough for the garbage you have to put up with, and it creates
underlying resentment throughout the whole operation. They seem to take
pride in denying people all the they can, and that includes denying the
independent adjuster a fair return on their investment of time and
labor. I swear, working in one of their offices, is often like working
in a maximum security prison. You have no freedom to do anything, except
kiss the guards asses continually, while they strip you of every bit of
pride you ever had in your work. Their arrogance is unequaled in the
industry, and as I have said, I have worked for just about everybody at
one time or another.
My advice. Never ever work for a State Farm catastrophe operation,
unless it’s minor wind or hail, or you get lucky and are working in an
independent’s branch completely separated from their offices. Otherwise,
you will have to put up with 10 times more crap than working for anyone
else, and if you’re lucky, you’ll make even less money.
One of the reasons I’ve always liked adjusting property claims in a
disaster situation, was because I felt like I was helping people.
Working for State Farm, I rarely have that feeling. Instead, I have the
feeling that I’m screwing people, and it’s awful. You go home tired at
night, after spending all day on your inspections, and you think about
all the people you screwed that day, because by the time you get done
with withholding their roof tear-off, and their depreciation, and their
hurricane deductible, they are left with nothing, except a premium
notice that just keeps on coming, year after year. This business has
gone down hill precipitously since I got into it ten years ago, and I’m
seriously thinking of leaving the industry. I just don’t get that good
feeling I used to, especially working for the Great Satan.
Which brings to mind something that just bugs the crap out of me. One of
the worst things State Farm does, in my opinion, is consider partial
roof replacement a betterment. I wish someone would challenge this in
court, again and again if necessary, because if I was sitting on a jury,
I would throw Holy Water all over them on this issue. It’s insane to
call slope replacement a betterment, and we all know it. In the mind of
the average Joe it’s a repair, because in most people’s minds the word
“roof” is singular.
If any independent adjusters are interested in joining me for a possible
class action lawsuit against State Farm, and the temporary employment
agencies they utilize; for unfair and deceptive labor practices, and
whatever else we can come up with, please contact me at my E-mail
address, or watch for future bulletins on this web page.
I have been told that there is a famed attorney who might be willing to
make our case, due to some common interest in another action he’s
undertaken, and which is currently pending against State Farm, by the
policy the holders in the state of Mississippi. Let’s face it, our
testimony could be devastating to State Farm, if we spoke on behalf of
the policy holders in any courtroom in the land. It could be the
greatest bombshell ever to hit the industry, and one well deserved. Much
bigger than the Allstate fury currently brewing in California.
What do we have to lose? Most of us don’t care if we ever work for them
again anyway. If State Farm disappeared tomorrow, most independents
would jump for joy.
”way to re-direct the subject of fraud” Please tell us what you mean by re-direct fraud. Should fraud not be fraud? ‘You’re really Bill Maher, aren’t you’? WOW – guess again. Back to your remarks -‘And way to re-direct the subject of fraud. Believe me, every insurance carrier who’s been proven to have committed illegal acts is taken to task in a big way’. Therein lies the problem. Why is it necessary to spend billions of dollars on millions of attornies to avoid paying claims that even YOU know should have been paid. Ask the thousands of homeowners in the Gulf whether their home was destroyed by wind or “wind blown flooding”. Katrina isn’t the only case for complaint. Wait until the wildfires in California have all worked there way through the legal system. I suppose it will all boil down to all insurance companies claiming lack of responsibility because of arson. My whole point is to get rid of about 90% of the attornies and conduct morals testing on claims adjusters so that payable claims will be honored. Why should you have to spend billions fighting to keep your golden towers. That is just penny wise and pound foolish.
I guess my question is, “Why would people concerned about flood not purchase flood insurance? Would your argument not become immediately moot if they had?” National Geographic even published an article stating that the Gulf Coast has flooded historically and systematically so often that only a low grade moron would continue to re-build and reside there. NATIONAL GEOGRAPHIC!!
Further, as a life-long California resident, I watched while numerous homeowners’ carriers, who had absolutely zero obligation to do so, paid for damages caused by the Northridge earthquake. Yes, carriers including the dreaded State Farm. I tell you this not to change your opinion but to provide facts that you seem unaware of. I also will not obsessively defend every individual who is employed by the insurance industry because I’ve certainly had dealings with more than one bad actor over my tenure. However, the idea that the insurance industry is rife with fraud and serves NO useful purpose is wrong-headed. Further, I can assure you that I, personally, have witnessed insurance companies pay claims when I thought they should not in the interest of goodwill. Seems to me that you should lead the charge in your particular state to create new regulation to tighten the legal structure. However, don’t be surprised when companies retreat because of a “hostile business environment”.
Moving to the beat of their own drum, no matter what! Nobler purposes. How about laying down a challenge? Some live to play the game. I WANT MORE! The goal is not to out manuver me. It’s not what we have, it’s much much more than that. Some seeds will fall on fertile ground and others will not.
Posted on Thu, Jul. 10, 2008
Study A- LEE
— Allstate is the nation’s worst insurance company for consumers, an association of lawyers who sue big business concludes in a report released Wednesday.
“The rankings show a distinct pattern of insurance industry greed amongst 10 companies that refuse to pay just claims, employ hardball tactics against policyholders, reward executives with extravagant salaries, and raise premiums while hoarding excessive profits,” the American Association for Justice concludes.
Researchers spent six months compiling information from court documents, SEC and FBI records, state insurance department investigations and complaints, nationwide news accounts, and testimony of former insurance agents and adjusters.
“We’re not surprised we’re being targeted by the trial and personal injury lawyers because Allstate has been at the forefront of the fight against insurance fraud and the effort to resist unreasonable demands made by lawyers,” Allstate spokesman Michael Siemienas said Wednesday.
“If trial lawyers and personal injury lawyers don’t like Allstate, the facts show that consumers do.”
The AAJ says the U.S. insurance industry collects more than $1 trillion in premiums annually, and has $3.8 trillion in assets, surpassing the Gross Domestic Products of all countries but the United States and Japan.
Robert Hartwig of the industry-sponsored Insurance Information Institute said consumers should consider the source: litigious attorneys who help drive up insurance costs. He also said the industry has paid out nearly $300 billion to tens of millions of policyholders across the country over the past 20 years.
The top 5 offenders on the list:
1. ALLSTATE – CEO, Thomas Wilson; 2007 compensation, $10.7 million; 2007 profits, $4.6 billion; assets: $156.4 billion. “According to investigations and documents Allstate was forced to make public, the company systematically placed profits over its own policyholders… The amount Allstate paid in claims dropped from 79 percent of its premium income in 1996 to just 58 percent 10 years later. In auto claims, payouts dropped from 63 percent to just 47 percent.
2. UNUM – CEO, Thomas Watjen; 2007 compensation, $7.3 million; 2007 profits, $679 million; assets, $52.4 billion. “Unum, one of the nation’s leading disability insurers, has long had a reputation for unfairly denying and delaying claims..”
3. AIG – CEO, Robert Willumstad; 2007 compensation for former CEO, 14.3 million; 2007 profits: $6.2 billion; assets, $1.06 trillion; “AIG executives have also come under fire for opportunistically seeking price increases during catastrophes. Now the company has been labeled ‘the new Enron’ because of charges of multibillion-dollar corporate fraud.”
4. STATE FARM – CEO: Edward B. Rust Jr.; 2007 compensation, $11.7 million; 2007 profits: $5.5 billion; assets, $181.4 billion. “In many cases, the company has gone to extreme lengths to avoid paying claims, including forging signatures on earthquake waivers after the deadly Northridge earthquake, and altering engineering reports regarding damage after Hurricane Katrina.”
5. CONSECO – CEO, C. James Prieur; 2007 compensation: $2.6 million; 2007 profits: $179.9 million; assets: $33.5 billion. “Conseco sells long-term-care policies, typically to the elderly. Unfortunately, Conseco uses the deteriorating health of its policyholders to its advantage because the company knows if it waits long enough to pay out claims, its customers will die.”
Iwant more.
Lawyers who subsist on the spoils of suing big business…. Very credible source of information.
Thank God there IS big business for them to suck off of. How else could they ply their wares?
I just love how these professional arguers who steal 30-50% of what should go to their clients, and act like they’re worth it and justify their existence. I wonder how policyholders would feel if I got paid 30-50% of their premium every time I was sitting on the toilet just thinking about their insurance? Sheesh!
justified- because “insurance companies never pay claims” but the truth is that these types of policyholders make the insurance company less likely to believe YOU when a loss occurs. wonder why insurance companies are cautious in their investigation of claims. You might think this is justified . okay I GET IT , IT WAS JUST justified “http://www.clarionledger.com/assets/pdf/D069388410.PDF
”Maybe you should direct your hate toward the perpetrators of fraud’.’ THAT,S WHAT IAM DOING.’We are legally obligated to prove we can meet certain financial responsibilities’. LIKE AIG -..RIGHT. In-a- consumer fraud case State Farm Insurance Company has battled for eight years to keep secret. Why what was the coat of this LITTLE-Secret ?
So again, the question is simple, why with all this agony do you continue to work with State Farm and people continue to buy policies from State Farm? It would seem to me that any company, no matter how large, would go under if they systematically cheated people. And who’s asleep at the wheel where various state insurance commissioners are concerned. Wouldn’t a CAT loss be a DOI’s top priority? Guess not. Hmmmm.
ITS CALLED WINDOW DRESSING/COMMERCIALS. HEY, WE ALL WANT TO BELIEVE IN COMPANIES THAT TELL US HOW GREAT THEY ARE. YOU HAVE PEOPLE WHO HAVE PAID THESE COMPANIES FOR YEARS IN GOOD FAITH. THIS IS A STORY THAT UNFOLDED IN A COURTROOM.
Comment:
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.”
Point? You have a point? I suspect you’ve become bored with bashing big oil (since we’ve all figured out speculators are the problem not producers) and now you’ve turned your pathological hatred of all things business to the insurance industry. Don’t you have a Wal-Mart somewhere to shut down? Run along, now.
Give up the fight Brokette. The loons are taking over this site. Can’t argue with nonsense. Anyone still believe there are no professionally paid posters on this site?
They never answer my questions but they sure know how to “cut & paste”, huh?
In response to your questions, STATE FARM IS EVIL. Satisfied Brokette?
I didn’t ask if they were evil. I asked why ANYONE would work for them or buy product from them.
BECAUSE THEY ARE EVIL AND HYPNOTIZE EVERYONE INTO TAKING THEIR EVIL COVERAGES. Just a joke Brokette, remember I am on your side?
State Farm buys ad time during Super Bowl pre-game
By Michelle Koetters
I asked why ANYONE would work for them or buy product from them.
BLOOMINGTON — Tens of millions of people will pay attention to Sunday’s big football game — and maybe even more so to the new, entertaining commercials.
State Farm Insurance Cos., however, hopes to capture the attention of core NFL fans before the New York Giants and the New England Patriots kick off the Super Bowl.
The Bloomington-based insurer will be the exclusive sponsor of a half-hour segment of the pre-game show, said Mark Gibson, assistant vice president for advertising. State Farm also will air several previously-seen ads throughout the pre-game show, Gibson said.
“We’re just excited about our partnership with the NFL,” Gibson said. “The Super Bowl has been an event, obviously, in America.”
State Farm also is the official insurance sponsor of the NFL and sponsors the organization’s all-star Pro Bowl, Gibson said.
The insurance company knows not as many people watch the pre-game show, but many viewers still tune in shortly after they wake up or come home from church, Gibson said. The slot before the game is a great opportunity to reach the biggest football fans and others who attend Super Bowl parties, he said.
The spots before the Super Bowl also are a more cost effective way for the company to get its name out to the public, Gibson said.
This year, the average 30-second television advertisement during the game on Fox is $2.7 million.
State Farm declined to release specific financial information, but Gibson said the company’s total advertising costs for the Super Bowl are significantly cheaper than one commercial during the game.
“It doesn’t even come close to costing what an ad would cost during the Super Bowl,” Gibson said.
Nice non-responsive answer.
Disney/Pixar’s summer film ‘Cars’ features an accident- prone hot rod. State Farm is on board with the picture.
By Theresa Howard, USA TODAY
NEW YORK — State Farm, the largest U.S. auto insurer, today will announce its first movie tie-in: with Disney/Pixar’s summer animated film Cars.
“People have more media choices than ever before, and this is a unique and different way to get our brand out there,” says Mark Gibson, assistant vice president for advertising, who wouldn’t disclose the cost.
The deal with the movie, whose characters are animated vehicles, comes as many insurers in the $450 billion property and casualty industry are spending big to put a more entertaining, accessible spin on promoting their business.
$450 billion get my ponit?
1. ALLSTATE – CEO, Thomas Wilson; 2007 compensation, $10.7 million; 2007 profits, $4.6 billion; assets: $156.4 billion. “According to investigations and documents Allstate was forced to make public, the company systematically placed profits over its own policyholders… The amount Allstate paid in claims dropped from 79 percent of its premium income in 1996 to just 58 percent 10 years later. In auto claims, payouts dropped from 63 percent to just 47 percent.
2. UNUM – CEO, Thomas Watjen; 2007 compensation, $7.3 million; 2007 profits, $679 million; assets, $52.4 billion. “Unum, one of the nation’s leading disability insurers, has long had a reputation for unfairly denying and delaying claims..”
3. AIG – CEO, Robert Willumstad; 2007 compensation for former CEO, 14.3 million; 2007 profits: $6.2 billion; assets, $1.06 trillion; “AIG executives have also come under fire for opportunistically seeking price increases during catastrophes. Now the company has been labeled ‘the new Enron’ because of charges of multibillion-dollar corporate fraud.”
4. STATE FARM – CEO: Edward B. Rust Jr.; 2007 compensation, $11.7 million; 2007 profits: $5.5 billion; assets, $181.4 billion. “In many cases, the company has gone to extreme lengths to avoid paying claims, including forging signatures on earthquake waivers after the deadly Northridge earthquake, and altering engineering reports regarding damage after Hurricane Katrina.”
5. CONSECO – CEO, C. James Prieur; 2007 compensation: $2.6 million; 2007 profits: $179.9 million; assets: $33.5 billion. “Conseco sells long-term-care policies, typically to the elderly. Unfortunately, Conseco uses the deteriorating health of its policyholders to its advantage because the company knows if it waits long enough to pay out claims, its customers will die.”
Get some new material.
You realize Brokette, that you are fulfilling the definition of insanity by trying to convince the insurance haters not to hate us.
You Clean One TOILET AT A TIME! TIE UP LOOSE ENDS. COMMERCIAL PSYCHOLOGY.
Here are answers to a bunch of your questions. I’ve been trying to say it but maybe you will listen to an industry giant!
Remember Lee Iacocca, the man who rescued Chrysler Corporation from its death throes? He’s now 82 years old and has a new book, ‘Where Have All The Leaders Gone?’.
Lee Iacocca Says:
‘Am I the only guy in this country who’s fed up with what’s happening? Where the hell is our outrage? We should be screaming bloody murder! We’ve got a gang of clueless bozos steering our ship of state right over a cliff, we’ve got corporate gangsters stealing us blind, and we can’t even clean up after a hurricane much less build a hybrid car. But instead of getting mad, everyone sits around and nods their heads when the politicians say, ‘Stay the course.’
Stay the course? You’ve got to be kidding. This is America, not the damned, ‘Titanic’. I’ll give you a sound bite: ‘Throw all the bums out!’
You might think I’m getting senile, that I’ve gone off my rocker, and maybe I have. But someone has to speak up. I hardly recognize this country anymore.
The most famous business leaders are not the innovators but the guys in handcuffs. While we’re fiddling in Iraq , the Middle East is burning and nobody seems to know what to do. And the press is waving ‘pom-poms’ instead of asking hard questions. That’s not the promise of the ‘America’ my parents and yours traveled across the ocean for. I’ve had enough. How about you?
I’ll go a step further. You can’t call yourself a patriot if you’re not outraged. This is a fight I’m ready and willing to have. The Biggest ‘C’ is Crisis! (Iacocca elaborates on nine C’s of leadership, with crisis being the first.)
Leaders are made, not born. Leadership is forged in times of crisis. It’s easy to sit there with your feet up on the desk and talk theory. Or send someone else’s kids off to war when you’ve never seen a battlefield yourself. It’s another thing to lead when your world comes tumbling down.
On September 11, 2001, we needed a strong leader more than any other time in our history. We needed a steady hand to guide us out of the ashes. A hell of a mess, so here’s where we stand.
We’re immersed in a bloody war with no plan for winning and no plan for leaving.
We’re running the biggest deficit in the history of the country.
We’re losing the manufacturing edge to Asia, while our once-great companies are getting slaughtered by health care costs.
Gas prices are skyrocketing, and nobody in power has a coherent energy policy. Our schools are in trouble.
Our borders are like sieves.
The middle class is being squeezed every which way.
These are times that cry out for leadership.
But when you look around, you’ve got to ask: ‘Where have all the leaders gone?’ Where are the curious, creative communicators? Where are the people of character, courage, conviction, omnipotence, and common sense? I may be a sucker for alliteration, but I think you get the point.
Name me a leader who has a better idea for homeland security than making us take off our shoes in airports and throw away our shampoo?
We’ve spent billions of dollars building a huge new bureaucracy, and all we know how to do is react to things that have already happened.
Name me one leader who emerged from the crisis of Hurricane Katrina. Congress has yet to spend a single day evaluating the response to the hurricane or demanding accountability for the decisions that were made in the crucial hours after the storm.
Everyone’s hunkering down, fingers crossed, hoping it doesn’t happen again. Now, that’s just crazy. Storms happen. Deal with it. Make a plan. Figure out what you’re going to do the next time.
Name me an industry leader who is thinking creatively about how we can restore our competitive edge in manufacturing. Who would have believed that there could ever be a time when ‘The Big Three’ referred to Japanese car companies? How did this happen, and more important, what are we going to do about it?
Name me a government leader who can articulate a plan for paying down the debit, or solving the energy crisis, or managing the health care problem. The silence is deafening. But these are the crises that are eating away at our country and milking the middle class dry.
I have news for the gang in Congress. We didn’t elect you to sit on your asses and do nothing and remain silent while our democracy is being hijacked and our greatness is being replaced with mediocrity. What is everybody so afraid of? That some bonehead on Fox News will call them a name? Give me a break. Why don’t you guys show some spine for a change?
Had Enough? Hey, I’m not trying to be the voice of gloom and doom here. I’m trying to light a fire. I’m speaking out because I have hope – I believe in America. In my lifetime, I’ve had the privilege of living through some of America ‘s greatest moments. I’ve also experienced some of our worst crises: The ‘Great Depression,’ ‘World War II,’ the ‘Korean War,’ the ‘Kennedy Assassination,’ the ‘Vietnam War,’ the 1970’s oil crisis, and the struggles of recent years culminating with 9/11.
If I’ve learned one thing, it’s this: ‘You don’t get anywhere by standing on the sidelines waiting for somebody else to take action. Whether it’s building a better car or building a better future for our children, we all have a role to play. That’s the challenge I’m raising in this book. It’s a “Call to Action” for people who, like me, believe in America’. It’s not too late, but it’s getting pretty close. So let’s shake off the crap and go to work. Let’s tell ’em all we’ve had ‘enough.’
Make your own contribution by sending this to everyone you know and care about. It’s our country, folks, and it’s our future. Our future is at stake!!
I don’t expect to change anyone’s mind (they’d have to HAVE a mind for me to be able to do that–okay, that was hateful) but how refreshing would it be to have them actually answer one of my questions?
I was given this book to read and stopped when I came to the conclusion that it should have been titled, “Why I Hate George W. Bush”. I can get that any night of the week on the network news. To say that Lee Iacocca isn’t the titan of industry that he used to be is a gross understatement. I will give him his due for his past successes but from the tone of the referenced book, he has nothing to offer but a simple rant. And Dennis Miller does it better.
McCarran-Ferguson Act
Federal legislation (U.S. Code Title 15, Chapter 20) enacted in 1945 to permit the states to continue regulating the insurance business after the Supreme Court, in U.S. v. South-Eastern Underwriters Association, overruled the decision in Paul v. Virginia, declaring insurance to be interstate commerce and therefore within Congress’s constitutional authority to regulate. Under the Act, insurance is exempt from some federal antitrust statutes to the extent that it is regulated by the states. The exemption primarily applies to gathering data in concert for the purpose of ratemaking. Otherwise, antitrust laws prohibit insurers from boycotting, acting coercively, restraining trade, or violating the Sherman or Clayton Acts.
I certainly rank the lawyers group this represents as the peak of integrity. Is Scruggs the leader? I love how they changed the name to take out any reference to lawyers. You do work for them don’t you?
You do work for them don’t you?
No.
I gave you too much credit then. You aren’t a mercinary, just ignorant. Try reading something other than Robert Hunter and the Trial Lawyers web sites. There is actual information based on fact out there in the real world, which you and they don’t inhabit. Now, go away ignorant person.