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A recent article reveals how the insurance companies will low-ball claims or delay claims all in the name of generating profits at the expense of policyholders. The insurance industry has been transformed from a service business to a profit-driven machine, according to a report in the Huffington Post.
Insurance companies want people to accept their low-ball offers. If people injured in accidents refuse the insurer’s offer, the insurance company may delay the claim. The tactic means many people injured in car accidents or harmed by other forms of negligence need to retain lawyers to pursue personal injury lawsuits to get fair compensation. See: Personal injury lawyers Raleigh NC
A former Allstate insurance agent told the trial lawyers lobby (American Associates for Justice) that the strategy was designed to make claims “so expensive and so time-consuming that lawyers would start refusing to help clients.”
The change to a more profit-driven model began when consulting firm McKinsey & Co. persuaded leading insurance companies like Allstate to use a computer-driven system that was designed to boost claims, according to the HuffPost report. People who accepted the low-ball offers received prompt service. Those who refused saw their claims delayed. See: (Glenn Law Firm)
The tactic appears to have paid off for the big insurance company. The story revealed that Allstate made $4.6 billion in profits in 2007, more than double the earnings it made in the 1990s. Most of the industry followed suit after noticing Allstate’s rise in profits.
Delayed claims can spell disaster for many families. According to the National Bureau of Economic Research, a study found that about one-quarter of all Americans could not come up with $2,000 in a 30-day period.
The Post article quotes a Rutgers law professor who explained how insurance companies sometimes do business. If you are in an accident, you may contact your insurance company, which dispatches an adjuster. The adjuster might tell you the damage is not covered, or, if it is covered, may offer a dollar amount they are “obligated to pay you,” said Professor Jay Feinman, who authored a book about the insurance industry called “Delay, Deny, Defend.” The average person does not have the expertise “to know whether that’s right,” he said. See : injury attorney Fort Worth
For many people, the best option is to retain a personal injury attorney who has a thorough understanding of the law and insurance regulations. An experienced lawyer may be able to negotiate a fair settlement on behalf of a client, or take the case to trial if necessary.
Don’t hesitate to contact a lawyer about your accident if the insurance company is not playing fairly. Most law firms provide free case reviews. You may be surprised at how effective you can be with an aggressive attorney on your side.
