Insurance Company Abuse

In 2007, CNN published an article about abuse by the insurance industry. The article discusses some of the tactics used by insurance companies to wrongfully delay, deny, and defend legitimate claims. The article notes that the insurance industry discriminates against the poorest sector of our society, all in the name of profits over people.

CNN notes that the article that was posted in 2007 continues to receive hundreds, if not thousands, of comments each day even through the present time. Problems with the insurance industry’s attempts to delay, deny, and defend claims continue and have only gotten worse. While I am very pleased with the insurance company that I have my coverage, I’ve seen insurance company propaganda through the years that is designed to make consumers believe that personal injury claims are causing insurance premiums to rise. Many of us have may have received emails about “the Stella Awards” which are supposed to provide information about outrageously wild runaway jury verdicts.

Joey McCutchen and I decided to do further investigation when, some years ago, we received an email telling us about several of these outrageous jury verdicts and awarding the Stella Award in a case purportedly arising out of Little Rock, Arkansas. It was reported that a man named Jerry Williams was awarded $14,500 plus medical expenses when he was bitten by his neighbor’s dog, in his neighbor’s yard, and the dog was on a leash and inside a fence, and Mr. Williams was obviously trespassing in the neighbor’s yard. Pretty wild, huh!

Joey and I thought it was pretty wild too. We knew that the claimed case couldn’t be true, even though the email claimed that the verdict had absolutely been handed down. When we investigated and told the sender of the email that there was no such case involving anyone named Jerry Williams in Arkansas, we were then told that the Stella Awards were a joke. The email that was sent held out the verdict as the absolute truth. The Stella Awards are nothing but an attempt by the insurance industry to mislead consumers, who may serve on juries, into believing that tort reform is essential to save society. Many other bogus claims have been fabricated to help the insurance industry poison consumers.

When it comes to telling the truth, many insurance companies have no hesitation about making up any facts to avoid paying claims. In our practice, we see insurance companies arbitrarily decide that an injured person’s treatment could not have lasted more than a set period (such as six weeks) after an injury. This occurs even when the insurance adjuster has no medical training and highly trained medical doctors attest otherwise. It’s all because of the need for insurance reform and regulation. For more information, see the report available at http://www.insurance-reform.org/studies/Repeat_OffendersFinal.pdf published by Americans for Insurance Reform.

Let me make clear that not every insurance company uses the wrongful tactics. Shortly before this blog was written, my daughter had an accident and was injured. The insurance company, which has a local presence and local adjusters, promptly contacted my daughter and arranged for a check for her property damage to be sent to her. I’m sure that they will negotiate in good faith about her injuries. But the great majority of insurance companies use tactics to delay, deny, and defend claims today.

Insurance companies are able to delay, deny, and defend in many cases without any fear of any real penalties. If you or I don’t pay our bills, we run the risk of having penalties imposed, like having our credit ruined, paying the creditor’s attorney fees, or paying interest on the amount we owe. But when insurance companies are able to cheat injured consumers with no fear of any penalties, there isn’t the necessary incentive for them to behave as responsible corporate citizens.

McCutchen Napurano - The Law Firm has been preaching about insurance reform for years now. If you agree, contact your legislators in the legislative session next year and demand insurance reform and accountability by insurance companies.