Greedy Trial Lawyer
Thieves And Con-Artists Who Call Themselves Insurance Companies
Category: Gaming The System
Property insurers are a pretty despicable lot. That is the only conclusion to be drawn after reading the article at Bloomberg.com excerpted below. If you read the entire article the carriers just get even more despicable.
Home Insurers' Secret Tactics Cheat Fire Victims, Hike Profits
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, and they sometimes ask their adjusters to lie to customers, court records and interviews with former employees and state regulators show.
The industry's drive for profit has overwhelmed its obligation to policyholders, says California Lieutenant Governor John Garamendi, a Democrat. As California's insurance commissioner from 2002 to 2006, Garamendi imposed $18.4 million in fines against carriers for mistreating customers.
"There's a fundamental economic conflict between the customer and the company," he says. "That is, the company doesn't want to pay. The first commandment of insurance is, 'Thou shalt pay as little and as late as possible.'"
Insurance is intended to provide prompt and full compensation at the time of a covered loss. When insurance carriers decide it is in their best interests to cheat and delay, they cease to be insurance carriers and become, instead, thieves and con-artists.
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