HARDBALL TACTICS OF SOME INSURANCE COMPANIES BEING REPORTED. A recent study by the Consumer Federation of America (CFA) revealed that property/casualty insurance companies (home and auto) are paying out less in claims compared to premiums collected than at any time in the past 20 years. Robert Hunter, the director of CFA attributed the decrease in payout in part to better underwriting and higher premiums but also in part to more aggressive claim management procedures. Allstate’s aggressive claim management procedures have recently been chronicled in a book by David Berardinelli titled From Good Hands to Boxing Gloves.  Shannon Brady Kmatz, a former Allstate adjuster who left the company in 2000, confirmed Allstate’s hardline approach to claim payout: “We called it throwing them [claimants] a bone.” In an article on insurance coverage in the March 2007 edition of Money magazine, Kmatz reported that she and other Allstate adjusters were evaluated on how quickly and cheaply they could settle a claim and on how well they did in dissuading claimants from hiring an attorney. Adjusters who excelled at these goals were rewarded with free dinners and monetary bonuses, said Kmatz. Many other home and auto carriers have also adopted similar claim management procedures and have adopted the use of injury claim evaluation software or damage assessment software (see related article on page 2). “The whole time these companies have been playing hardball with consumers, they have also been promoting the concept, via the mainstream media, that a claimant who does not rollover and accept their lowball offer is being greedy,” said Mark Wolfe. “This is one of the reasons legitimate injury victims find themselves as the underdog when pursuing their claim through the court system,” said Wolfe. 

COURT SYSTEM FAVORS THE INSURANCE COMPANIES. Most of the time in court proceedings jurors are not told of the claimants attempts to resolve the claim prior to filing a lawsuit and in many States, such as Alabama, jurors can not be told that the at-fault driver, who has to be the defendant in a civil suit, has liability insurance that will pay the judgment. “I had one juror tell me that during deliberations they [the jury] concluded that since no one mentioned anything about the defendant’s insurance the victim must have already been paid all of the insurance money and was now just being greedy trying to get more money directly from the defendant,” said Wolfe. The juror went on to say the jury awarded the victim no damages in the case. Such inequities in the civil justice system are common for auto-negligence victims in Court. “For the past 15 years we have been reporting on the hardball tactics of insurance companies and the difficulties faced by legitimate injury victims and claimants in our court system,” Wolfe said. “Maybe, just maybe, enough people have been victimized by insurance companies that it is attracting the attention of mainstream media,” concluded Wolfe. Since Hurricane Katrina devastated the Gulf Coast the media has been intensely reporting on the unfair claim practices of many insurance carriers.