The 10 Worst Insurance Businesses

28 Apr

To identify the worst insurance coverage businesses for customers, researchers at the American Association for Justice (AAJ) undertook a extensive investigation of 1000’s of court documents, SEC and FBI records, state insurance coverage division investigations and complaints, news accounts from across the nation, and the testimony and depositions of former insurance coverage agents and adjusters. The final list incorporates organizations across a assortment of various insurance fields, such as home owners and auto insurers, wellness insurers, life insurers, and disability insurers.

The report is all about the insurance coverage industry and the difficult tactics they use to boost profits. Once this kind of tactic is “deny, delay, defend.” Records showed a distinct pattern of insurance coverage companies refusing to pay out claims, using “hardball” strategies towards policyholders, raising premiums with warrant, hoarding extreme profits and awarding extravagant salaries.

1. Allstate ranks as the worst insurer for customers, according to a comprehensive investigation of thousands of authorized documents and fiscal findings.
The rankings display a distinct pattern of insurance coverage sector greed amongst 10 businesses that refuse to shell out just claims, utilize hardball methods towards policyholders, reward executives with extravagant salaries and increase premiums whilst hoarding excessive profits.

“Even though Allstate publicly touts its ‘good hands’ method, it has instead privately instructed its agents to utilize a ‘boxing gloves’ approach towards its policyholders,” said American Association for Justice CEO Jon Haber. “Allstate ducks, bobs and weaves to stay away from having to pay claims to increase its income.”

Allstate (NYSE: ALL) set the regular for insurance organization greed and placing revenue above policyholders. Allstate contracted with consulting giant McKinsey & Co. in the mid-1990s to systematically force shoppers to accept low ball claims or face its “boxing gloves,” an aggressive technique created to deny claims at any price. A single Allstate worker reported that supervisors advised agents to lie and blame fires on arson and in flip, were rewarded with moveable fridges.

Thousands of court paperwork, materials uncovered from litigation and discovery, testimony, complaints filed with state insurance coverage departments, SEC and FBI records and news accounts had been reviewed to compile the rankings and figures.

The rest of the rankings are as follows:

2. Unum (NYSE: UNM) – Unum’s actions are even far more shameful considering the variety of insurance it sells: disability. Unum’s behavior was epitomized when it denied the declare of a woman with multiple sclerosis for 3 years, stating her circumstances have been “self-reported,” contrary to doctors’ evaluations. In 2005, Unum agreed to a settlement with insurance commissioners from 48 states over their practices.

3. AIG (NYSE: AIG) The world’s largest insurer, AIG’s slogan was “we know funds.” AIG, described by commentators as “the new Enron,” has engaged in enormous corporate fraud and claim abuses. In 2006, the organization paid $1.6 billion to settle a host of costs.

4. State Farm is notorious for it can be deny and delay tactics and like Allstate, employed McKinsey consultants. State Farm’s accurate motives grew to become apparent throughout Hurricane Katrina for example, it employed numerous engineering firms till they could deny the claims of the Nguyen family in Mississippi. In April 2007, State Farm agreed to re-assess a lot more than 3,000 Hurricane Katrina claims.

5. Conseco (NYSE: CNO) Conseco sells extended-term care policies, generally to the elderly. Amongst its egregious behavior, the insurer “made it so hard to make a declare that folks both died or gave up,” explained former Conseco subsidiary agent. Former Conseco executives had been fined when admitted to filing misleading fiscal statements with regulators.

6. WellPoint (NYSE: WLP) Well being insurer WellPoint has a extended historical past of placing profits ahead of policyholders. For instance, California fined a WellPoint subsidiary in March 2007 following an investigation revealed that the insurer routinely canceled policies of pregnant ladies and chronically sick clients.

7. Swiss-owned Farmers Insurance Group persistently ranks at or close to the bottom of house owner satisfaction surveys and for very good reason. For illustration, Farmers had an incentive system known as “Quest for Gold” that provided pizza events to its adjusters that met low claims payment objectives. Like Allstate, it also employed the McKinsey consultants.

8. UnitedHealth (NYSE: UNH) The SEC opened an investigation into former UnitedHealth CEO William McGuire for stock backdating, which eventually led to his ouster in 2006 and returning $620 million in stock gains and retirement compensation. Doctors have also reported that their reimbursements are so very low and delayed by the company that patient overall health is getting compromised.

9. Torchmark (NYSE: TMK) According to Hoover’s In-Depth Firm Records, Torchmark’s really origins were little more than a scam devised to enrich it founder, Frank Samford. Torchmark has preyed on reduced-revenue Southern residents and charged minority policyholders a lot more than whites on burial policies.

10. Like Allstate and State Farm, Liberty Mutual hired consulting giant McKinsey to adopt aggressive methods. Liberty’s tactics have been highlighted when a New York couple’s insurance coverage was “nonrenewed” by Liberty, even even though they lived 12 miles from the coast and never knowledgeable climate-relevant flooding.

5 Responses to “The 10 Worst Insurance Businesses”

  1. Chang February 14, 2013 at 7:53 am #

    Hello I’m an insurance coverage agent having a horrible situation of bad personal time management and disorganization. I’m a good person and am not rude or disrespectful to my clients but due to the above mentioned issues I’m losing clients. I have to bring in help however i can not afford it. I’m missing telephone calls and never calling in a timely fashion. (not since i don’t care but because I haven’t got focal points. I simply were built with a baby and i’m torn for my child too. (That’s also why my company is flailing) I’m behind on my small documents and individuals are beginning to obtain pist. Am I Going To be redeemable to my clients basically change my disorganized existence around? Or must i give on possessing my opportunity and let another person and provide better plan to my clients. (It will make time to change) I’m really sick over this more in my clients though. What must i do?

  2. James February 16, 2013 at 3:01 am #

    Health care cost is harming the budgets of working families, companies, states and the us government. Don’t let me know someone is searching for a handout if this involves something as fundamental as health care. An easy accident can eliminate hard-won savings in almost any family. Now how’s McCain gonna get it done? Please?

  3. Junita February 20, 2013 at 5:05 pm #

    I must open a company or franchise but I’m not sure about how much cash I’ll need

  4. Darrick February 25, 2013 at 10:21 pm #

    I’m wondering if my opportunity will still offer insurance and when not, where I’ll get comparable and affordable coverage…

  5. Douglass March 7, 2013 at 8:09 am #

    Even when the main reason people did not have medical health insurance was simply because they could not afford it.

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