If you’ve ever had to negotiate with an insurance company on your own, you know what a frustrating experience it can be. Sometimes you’re made to feel like you’ve done something wrong when you’re suffering from injuries resulting from someone else’s negligence, or you are sick through no fault of your own. Other times it just seems like the insurance company wants to put you off and stall as long as possible before paying out as little as possible towards your claim. If you’ve found yourself in one of these situations, you might be wondering if you did something wrong or if you just had a bad insurance agent.
Unfortunately, for many Americans this kind of “customer service” is de rigueur in the insurance industry. Remember, these companies have to keep an eye on their bottom line, so it is in their best interest to get as much as they can from you in premiums, then pay out as little as possible when you try to collect on a claim.
Get to Insurance Claims Quickly
One common tactic of insurance companies is to pump you for as much information as possible before you have the chance to speak with a lawyer. They’ll record your statements, make you sign forms, grill you about your previous and current medical and claims history, and some will even discourage you from speaking with a lawyer. They do this because once they have all of your information they will try to get you to agree to a quick and cheap settlement. And you know what? If the insurance company strings you along long enough, you could end up past the statute of limitations for bringing a case against them. Once your statute of limitations expires, there isn’t anything you can do – and the insurance company will happily be rid of you.
Unfortunately, some people are so sick of dealing with the insurance company’s tricks that they’ll take whatever they can get so they can move on with their lives. Sadly, this just encourages insurance companies to keep using these kind of guerilla tactics on the sick and the injured.
What can you do? Don’t give any statements, sign any forms, or disclose any other information until you’ve had a chance to speak with a lawyer. If after speaking with a lawyer you determine that you can handle the case yourself – then go ahead and deal with the insurance company. However, if it turns out that it is in your best interest to retain a lawyer, you definitely want his or her advice and support when it comes to dealing with the insurance company.
The Profit Motive
Large companies need to make as much profit as possible for their shareholders, while at the same time they need to pay for their enormous staff, all of their office buildings, the slick advertising, and still have money left to pay out claims. Of course, the larger the company, the more money they need to make to stay on top of the market and keep their profits high. You might be wondering: how do they maximize profits?
- Hire cheap and inexperienced claims adjusters
- Use claims adjustment software to keep payouts low
- Keep law firms on retainer
- Increase client base by offering inexpensive insurance to as many people as possible
- Control costs by denying claims outright or by paying out as little as possible on claims
Inexperienced Adjusters and Software Standardization
Young, inexperienced claims adjusters are a real money saver for large insurance companies. They don’t need to pay for a large number of experienced (and expensive) adjusters, and by investing in claims adjustment software (like Colossus software, for example) they can keep their young staff in their cubicles punching a computer keyboard rather than pounding the pavement to get the real scoop on your accident.
While the idea of standardizing payouts for similar kinds of accidents and injuries is a good one, in practice the combination of inexperienced adjusters and software programs biased towards insurers rarely provides fair compensation to an accident victim. If you think about it, no two people are exactly alike and neither are two accidents. It might be helpful to have guidance from an unbiased software program to provide a starting point for determining what a claim is worth, but in reality it’s often the software – which is programmed to favor the insurance company – that has the final word on how much you’ll receive.
Law Firms on Retainer
You might be wondering what it means to keep a law firm on retainer. This simply means that insurance companies pay a flat rate to a law firm so they’ll work on whatever comes up, rather than pay an hourly attorney rate like most people do. This means the law firm they have on retainer can afford to have young attorneys and paralegals work your small case for years, dragging it out as long as they need to in order to pay out as little as possible. They’re even happy to take you to court, and make it sound to the jury like you’re trying to scam them with your illegitimate claim!
Lots of Clients, Small Payouts
In order to grow their business, insurance companies need to have lots of customers. However, to have lots of customers they need to be less selective about whom they insure. If they agree to insure people with less than stellar driving records, they’ll be paying for more accidents. If they have to pay for more accidents, they better find a way to pay as little as possible to keep profits up and shareholders happy.
In an expose CNN found that two of the largest insurance companies – Allstate and State Farm – have adopted tough “take it or leave it” strategies when dealing with minor car accidents. According to CNN, “If you challenge the offer by some insurance companies you will be left with no option but to go to court, where you will be dragged through the wringer.” Part of the insurers strategy is to make it look like the person with the claim is trying to defraud the insurance company, so if the case gets to court jurors feel as though they are “doing the right thing” by denying payment in a case or offering as little as possible. One Allstate insider claimed that they practiced the 3 Ds:
- Deny the claim
- Delay settlement of the claim
- Defend against the claim in court
Does this sound like the tactics of an industry that cares about its clients or is looking out for your best interest? We don’t think so!
Are you suffering from the effects of an accident or injury that resulted from somebody’s negligence? Fed up dealing with the insurance company, or worried about being treated fairly? Or, has your insurance claim been denied? The Virginia based attorneys at Dulaney, Lauer, and Thomas, LLP want to help make sure you get the compensation you deserve. If you or somebody you love is unfortunate enough to be involved in a serious auto accident, truck accident, drunk driving accident, motorcycle accident, or construction accident our law firm wants to help. Please contact Dulaney, Lauer, and Thomas to discuss your case for no cost and no obligation.