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COSTA CONCORDIA Passenger Claims

An article in the Miami Herald discussed lawsuits being instituted in behalf of passengers aboard the COSTA CONCORDIA. Two New York lawfirms claim to be representing “hundreds” of passengers.

The shipowner has offerred 11,000 euros, or about $14,500, to settle claims by the 3,206 passengers who were not physically injured. It has been noted that the settlements would total about $46 million, or 12 days of projected Carnival Cruise profits for 2012.

The Miami Herald article reports that maritime plaintiff lawyers in Miami and Los Angeles have valued the claims in the range of $60,000 to $100,000.

Both the shipowner and the lawyers treat the claims as if there were coupons. They are not. Claims for psychological damages suffered by passengers are based upon the experience of the individual person and the consequences in terms of emotional pain and suffering.

It is likely many passengers will suffer the effects of post traumatic stress disorder (“PTSD”). The nature and extent of this condition cannot be immediately known. No passenger should consider final settlement of his or her claim unless and until the emotional effects, which may be latent, are evaluated by a professional.

PTSD is a well established medical condition. The Diagnostic and Statistical Manual of Mental Disorders, Fourth Edition Text Revisions (DSM–IV-TR) states:

The essential feature of Post Traumatic Stress Disorder is the development of characteristic symptoms following exposure to an extreme traumatic stressor involving direct personal experience of an event that involves actual or threatened death or serious injury, or other threat to one’s physical integrity; or witnessing an event that involves death, injury, or a threat to the physical integrity of another person; or learning about unexpected or violent death, serious harm, or threat of death or injury experienced by a family member or other close associate (Criterion A1). The person’s response to the event must involve intense fear, helplessness, or horror (or in children, the response must involve disorganized or agitated behavior) (Criterion A2). The characteristic symptoms resulting from the exposure to the extreme trauma include persistent reexperiencing of the traumatic event (Criterion B), persistent avoidance of stimuli associated with the trauma and numbing of general responsiveness (Criterion C), and persistent symptoms of increased arousal (Criterion D). The full symptom picture must be present for more than 1 month (Criterion E), and the disturbance must cause clinically significant distress or impairment in social, occupational, or other important areas of functioning (Criterion F). DSM–IV-TR, p.463. [Emphasis supplied.]

The manual goes on to discuss the various symptoms of PTSD, including flashbacks, avoidance, sense of foreshortened future, anxiety, sleeplessness, recurrent nightmares, outbursts of anger, as well as painful guilt feelings about surviving when others did not survive.

Symptoms of PTSD usually begin within the first three months after the trauma, although there may be a delay of months, or even years, before symptoms appear. DSM–IV-TR, p.466.

According to the National Center for PTSD, an agency of the U.S. Department of Veterans Affairs, symptoms of PTSD may come and go over many years. About half (40% – 60%) of people who develop PTSD get better at some time. But about one out of three people who develop PTSD will always have symptoms.

As stated by the National Center for PTSD:

Symptoms of post traumatic stress disorder (PTSD) can be terrifying. They may disrupt your life and make it hard to continue with your daily activities. It may be hard just to get through the day.

It is to be hoped that only a small percentage of the passengers who survived the wreck of the COSTA CONCORDIA will suffer from full-blown PTSD. But it would be naive for anyone who survived the ordeal to discount the possibility of emotional consequences.

The lawfirm of Anderson, Connell & Carey has represented survivors of shipwrecks who have suffered psychological effects and have been compensated accordingly. In one case, the recovery for PTSD exceeded $1,000,000. In most cases, the effects are not so profound as to warrant an award of that magnitude, but the condition can be serious and the suffering profound.

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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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