The Dark Side of Insurance
In the past, insurance companies have been protective, service-oriented organizations that the public trusted. But in the mid-90s they began to evolve by adopting a new business model based on profit. Unfortunately, the profit motive has caused many insurance companies focus so much on pleasing shareholders that they have overlooked their responsibility to their insurance policy holders.
The Huffington Post examined the changes in the insurance industry. The shift began when companies moved from having claims adjusted by people to using a complex computer model to determine payments. In this new computer model, the adjuster takes information from a customer who was rear-ended and feeds it into the computer. The software produces a low offer for the auto accident victim. Often times this offer does not begin to cover the victim’s medical expenses and lost wages. If the person takes the low offer, he or she receives prompt service and the claim is quickly closed. If he or she does not accept the payment, the insurance company continually delays the claim. This model often pushes the customer to hire a car accident attorney to file a lawsuit on his or her behalf.
Former Allstate Insurance agent Shannon Kmatz explained this system to the trial lawyers’ lobby, the American Association for Justice. She explained the goal was to make it unprofitable for lawyers to help clients with their claims by making the process lengthy and costly. She went on to say the business had turned into a “zero-sum game” in which “improving Allstate’s casualty economics [has] a negative economic impact on some medical providers, plaintiff attorneys, and claimants. … Allstate gains — others must lose.” On average, Allstate pays about 30% of a claim’s actual value. An unpublished poll indicates 16% of American adults have dealt with financial difficulties while waiting for an insurance claim to come through.
Insurance adjusters are paid to deal with claims all day long. You are not. If you are in a car accident, consult with an auto accident attorney right away. The right lawyer can help you get the full value of your claim without hours spent on hold and weeks spent calling the insurance company. You do not have to fight the insurance company alone.