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Car Wrecks: Insurers Playing Hardball

Last week, CNN ran a special report detailing how insurance companies, led by Allstate and State Farm, have adopted hardball tactics on car wreck claims in order to boost their profits.  Some excerpts of an article are as follows:

If you are injured in a minor car crash, chances are good that you will be in the fight of your life to get the insurance company to pay all the medical costs you incur — even if the accident was no fault of your own.

That’s what CNN discovered in an 18-month investigation into minor-impact soft-tissue injury crashes around the country.

In an affidavit in a New Mexico case where Allstate is being sued, one of the company’s former attorneys said the strategy is to make fighting the company “so expensive and so time-consuming that lawyers would start refusing to help clients.”

Playing off Allstate’s signature slogan, one document recommends the insurer put boxing gloves on its “good hands” for those who insist on going to court.

The strategy, according to former Allstate and State Farm employee Jim Mathis, relies on the three D’s — denying a claim, delaying settlement of the claim and defending against the claim in court.

“The profits are good, and as long as the community, the public allows this to occur, the insurance companies will get richer and people … will not get a fair and reasonable settlement,” Mathis said.

This comes as no surprise to those of us practicing personal injury litigation.  Unfortunately, the practices seem to be getting worse, not better.  In the past, most of the abuses were seen in third party claims — claims where a third party is seeking to recover from the insurance company of the person that hit them.  But now, it seems these abuses are extending to first party claims — claims where people make claims on their own insurance (whether it is underinsured/uninsured motorist coverage or trying to get benefits for personal injury protection coverage).

We hope you keep this type of information in mind when making your next insurance purchase.

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