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Insurance Industry Cited for Bad Business Policies

The rankings show a pattern of insurance industry avarice amongst 10 companies that refuse to pay just claims, reward executives with extravagant salaries, employ hardball tactics against their own customers, and unjustly raise premiums while hoarding tremendous profits. Ranked number one as the worst was Allstate. For example, in the 1990’s Allstate contracted with McKinsey & Co. to force consumers to accept low-ball claims or face litigation. Allstate told agents to lie and blame fires on arson, and in turn, were rewarded with gifts and cash rewards.

Number two on the list was Unum. Unum, a disability insurance company purposefully denied just claims in order to maximize profits. In one instance a woman who had multiple sclerosis was forced to wait three years before she was given benefits to which she was entitled.

Number three on the list was AIG, the world’s largest insurer. According to commentators, AIG has engaged in massive fraud and claims abuses.

Number four on the list was State Farm. State Farm’s true motives became apparent during Hurricane Katrina where State Farm consistently denied valid claims of policy holders.

Number five on the list was Conseco. Well known in the industry for a policy to make it so hard on claimants that they either died or gave up.

Number six on the list was Wellpoint. Wellpoint was exposed to have an internal procedure for canceling policies of pregnant women and chronically ill patients.

Number seven on the list was Farmers. Farmers offered pizza parties for adjusters who met low claims payment goals.

Number eight was UnitedHealth. The SEC opened an investigation into former UnitedHealth for back dating stock options.

Number nine was Torchmark. Torchmark has preyed on low income Southern residents and charged minority policy holders more than whites on burial policies.

Number ten was Liberty Mutual. Like Allstate and State Farm, Liberty Mutual hired consulting giant McKinsley to adopt aggressive no pay tactics.
The insurance industry takes in over $1 trillion in premiums every year. It has $ 3.8 Trillion in assets, more than the GDP of every country in the world except for the United States and Japan. The insurance industry is regulated, but obviously more needs to be done to reign in abuses. If nothing is done, the rights of consumers will continue to play second fiddle to insurance company profits.

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