Monday, August 31, 2009

American Assoc. of Justice Report: 10 Worst Insurance Companies for Consumers

by Val McCall, Face Book Supporter

The American Association for Justice recently released a report entitled, "10 Worst Insurance Companies for Consumers." The report goes beyond health insurance coverage and takes an in depth look at the insurance industry as a whole. The findings show how an industry that no doubt began as a means to provide a service, centering on consumer protection, for a fee in a free market society, has run amok. The focus has drastically shifted from the consumer to profits for the industry -- especially for share holders and CEOs -- at all costs.

At the top of the list is Allstate, whose symbolic logo of a pair of seemingly strong hands, boasts the slogan, "you're in good hands." No doubt, Allstate's symbolism is used to instill a sense of security to its clients and prospective clients. There's a caveat to that slogan, "if you are a shareholder." As noted in this report:
"Allstate-The Worst Insurance Company in America.

One company stood out above all others. Allstate's concerted efforts to put profits over policyholders has earned its place as the worst insurance company in America. According to CEO Thomas Wilson, Allstate's mission is clear: "our obligation is to earn a return for our shareholders." Unfortunately, that dedication to shareholders has come at the expense of policy holders. The company that publicly touts its "good hands" approach privately instructs agents to employ a "boxing gloves" strategy against its own policyholders. In the words of former Allstate adjuster Jo Ann Katzman, "We were told to lie by our supervisors--it's tough to look at people and know you are lying."
The insurance industry leads all other industries in profits, taking in over $1 trillion annually, and with assets over $3.8 trillion ("more than the GDPs of all but two countries in the world (United States and Japan)." Their strategy is to simply payout less through delaying and denying claims. The report states further:
"As a senior executive at the National Association of Insurance Commissioners (NAIC), the group representing those who are supposed to oversee the industry, said, "the bottom line is that insurance companies make money when they don't pay claims."

One example is Ethel Adams, a 60-year-old woman left in a coma and seriously injured after a multi-vehicle crash in Washington State. Her insurance company, Farmers, decided the other driver had acted intentionally and denied her claim, contending that an intentional act is not an accident.

Another example is Debra Potter, who for years sold Unum's disability policies until she herself became disabled and had to stop working. All along, Potter thought she was helping people protect their future, but when her own time of need came, she was told her multiple sclerosis was "self reported" and her claim denied by Unum, the very company whose policies she had sold.

In cases like these, and countless others, the name of the game is deny, delay, defend -- do anything, in fact, to avoid paying claims. For companies like Allstate, there are corporate training manuals explaining how to avoid payments, portable fridges awarded to adjusters who deny the most claims, and pizza for parties to shred documents."
I'm all for a free market society but not at my expense. When we set out to buy a car, we do all sorts of information gathering and go from dealer to dealer, looking for the best buy. If it is used, we want to see the "car fax." We do the same when we buy a house, or anything else. Our health insurance should be no different. This report clearly shows, without a doubt, we cannot allow these practices to continue.

Regulations are not Enough

None of us want "government running our lives." The thought of a government employee deciding on our health care is just as repugnant as having an insurance company employee making that decision. Right now, the leading decision maker for health care is the insurance industry and not doctors.

We need regulations in place to put an end to the insurance industry's "deny, delay, defend -- do anything, in fact, to avoid paying claims" business practices. But regulations are not enough. People who do not have medical insurance do not see a doctor for medical checkups; they go to the emergency room when something drastic has occurred, often requiring extensive -- and expensive -- medical treatment. By default, those of us with insurance are paying for those of us without insurance, ratcheting up our premiums out of our reach, tossing us into the cycle of unexpected illness/accident, insurance coverage/treatment denial, and bankruptcy. The American Medical Journal released a report, Only in America: Bankruptcies due to Health Care costs stating that 62% of bankruptcies filed in the US in 2008 were from health care costs. Moreover, the majority of those filing had health insurance.

End the Health Insurance Industry Monopoly

We need a strong public option that will allow us to provide ALL American citizens with quality, affordable health care while simultaneously ensuring that the market remains competitive for the benefit of the consumer. A public option will do both.
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