Claims Reporter searches the internet 24 hours a day, bringing together all the latest important insurance news, from thousands of sources across the US.

September 5th, 2007: Encountering The Perils And Pitfalls Of Shopping Online For Auto Insurance

The Internet and one of its most powerful segments, e-commerce, represent some of the most amazing technologies of all time. But it is still a work in progress and has a long way to go. One perfect example of that involves shopping for auto insurance online.....

The Bullentin, (Philadelphia Family Newspaper), 9/5/2007, by Herb Dennenberg

September 2007: Insurance Companies are using your Credit Score 

You may not be aware of this, but there are some unfair rating tactics being utilized by auto insurance companies that the public isn't even aware of that are not only discriminatory, but are helping to boost the insurance company's profitability.....

Here it is: insurance companies in New Jersey are now able to use your credit score to determine the price of your auto and home insurance. The better your credit score, the steeper the discount you will receive. For those of you with credit scores below 600, Ouch!..... This infuriates many people, because if they have a perfect driving record with no accidents or violations, but have an adverse credit situation, or a slightly less than desirable credit score, they have to pay more for their insurance, whereas the rich guy who doesn't need the discount pays 50% less or sometimes 300% less than you because he's rich...

Content4Reprint Article, September 2007

August 26th, 2007: Auto Insurance Bill Got You Down? Here Are Seven Things To Consider

My wife and I switched our auto insurance coverage recently and paid our full annual premium up front. It was a painful little payment, even though we had shopped around and such. This led us to both researching various methods with which one could save money on auto insurance. Here are seven useful and applicable tips that we discovered.

The Simple Dollar - financial talk for the rest of us, 8/26/2007

August 2007: Insurance you didn't know you had

Your home, auto and medical coverage could be better than you think. Here are 11 scenarios for which you might be pleasantly surprised to learn you can file a claim....

If you took an ax to your kitchen floor, the damage typically wouldn't be covered by your homeowners insurance. Insurers generally don't cover intentional damage, and whacking a floor with an ax is considered pretty intentional......Except when the blows are inflicted in the course of dispatching a rattlesnake that slithered into your kitchen, threatening your wife and 3-year-old child.

That's what happened to a friend of Bill Sirola, a spokesman for the nation's largest homeowners insurer, State Farm, and the insurer paid up without a murmur.....

MSN Money, 8/2007, by Liz Pullman

August 28th, 2007: Things that Will Drive Your Auto Insurance Cost Up: The Top Ten (or More)

"....Men will pay more for auto insurance than women because men are more aggressive drivers"....

Associated Content (AC - The People's Media Company), 8/28/2007

August 24, 2007 - Minorities Are Often Stung By Credit-Based Insurance Rates

Credit scores are good for auto insurance companies, but problematic for African-American and Hispanic consumers.

The study found credit scores effectively predict the number of claims consumers file and the total cost of those claims. However, it also found that black and Hispanic consumers tend to have lower scores than non-Hispanic whites and Asians. As a result, consumers in those demographic groups, on average, end up paying more for car insurance

Asa Aarons, New York Daily News, August 24, 2007

August 20, 2007 - John Edwards 08 Blog, Posted 8/20/2007:
(Join the Campaign to save America !)

Many are sorry for the fate of home owners who found that their "Replacement Insurance" did not pay to replace their burn down home, specifically, those burnt down by wildfire in So. California. They were surprised to learn their insurance had been converted to "Extended Replacement Insurance" and paid only about half the price of the home.

All State and Farmers Insurance had been trained, according to the PBS Program NOW, by experts on how to avoid paying off, delay, harass, threaten and scare clients who wanted more than offered in settlement. I guess we are back to the Predatory World of medieval times? Or, are we approching the "law of the Jungle"?

August 20, 2007 - USA Today - Cars damaged from Katrina?

Still, the odometer showed only 70,000 miles. And the car was a private-party bargain at $2,400, far below what he figured a dealer would charge.

But by the time the Chevy broke down a second time in San Diego freeway traffic, Leiken concluded that he had bought a clunker damaged in Hurricane Katrina.

"I should have had alarm bells going off," says Leiken, 21, who says his suspicion was confirmed by mechanics who found telltale rust, salt and water damage in the engine and residual moisture in the trunk. A Carfax vehicle-history report proved the car was in Louisiana when the hurricane struck......

http://www.usatoday.com/money/autos/2007-08-20-flooded-cars_N.htm

August 20, 2007 - Insurers learn to pinpoint risks -- and avoid them

RMS' techniques and those of the data-miners share three crucial similarities: They're only possible because of recent advances in computing power. They generate predictions about individual people and properties. And they have set off a mad scramble among insurers to slice their once-broad pools of policyholders into finer risk categories.

Northbrook, Ill.-based Allstate now sorts its home and auto policyholders into 384 categories, up from the three that it used until a few years ago. At Bloomington, Ill.-based State Farm, the nation's largest auto and home insurer, the number of categories the company uses has increased 100-fold. At Cleveland-area-based auto insurer Progressive, the number runs into the millions.

But the ever-finer slicing appears to be having other effects as well, ones that worry a variety of regulators and insurance theorists.

Latime.com - headline news 8/20/2007, orig. pub 11/2006

August 11th, 2007
ezine article -

How To Negotiate A Good Settlement With An Insurance Claims Adjuster

The following is an account of actual events as they were experienced by John Corbin (article's author).... posted in ezinearticles.com, scanned/reviewed: August 11th, 2007:

John was the victim of an injury causing motor vehicle accident..... He shows you with a little knowledge, how to negotiate successfully to get your just due claim....

August, 2007
www.ocala.com
TALLAHASSEE - Upset that consumers haven't seen big savings in their homeowner's insurance, Gov. Charlie Crist said Tuesday the state could back out of a deal that provided insurers with cheaper coverage while the state assumed a much bigger risk for a mega-storm season.

Prompted by Chief Financial Officer Alex Sink, Crist said he was willing to reconsider the state's move to pick up another $12 billion in backup coverage for the private insurance market, or reinsurance.

"It's a good thought," Crist said. "What the Legislature gave they can taketh away."
BY LLOYD DUNKELBERGER, STAR-BANNER TALLAHASSEE BUREAU, 8/2007

June 20, 2007
Crashnetwork.com
Some of the lawyers representing homeowners who are suing State Farm following Hurricane Katrina claim they have internal company e-mails to prove that the insurer was pressuring an engineering firm to conclude that damage to homes was caused by rising water, not wind, reports USA Today. State Farm and other insurers cover wind damage, but not rising water damage, including wind-driven storm surge. The engineering company, Forensic Analysis & Engineering Corp., turned over the e- mails as part of the pretrial discovery process for one of the lawsuits. One of the attorneys suing State Farm, Zach Scruggs, said the e-mails "confirm everything that we have always suspected...What it says is pretty shocking. This outlines the whole scheme of theirs."
Crashnetwork.com

Randall urges Leahy to consider reform

Following is a letter that Don Randall wrote to Senator Patrick Leahy concerning the possible repeal of the McCarran-Ferguson Act (CRASH 3/4/07 and 4/15/07):

I was privileged to serve on the staff of Senator Phillip Hart's antitrust subcommittee from 1966 to 1973. I handled the automotive industry investigation and wrote a book about the findings from the two-year investigation, entitled The Great American Auto Repair Robbery. One chapter dealt with the harmful effects of the insurance industry's monopsony (price and performance control) domination of the automotive collision shops throughout the United States.

THAT SITUATION HAS BECOME MUCH WORSE OVER THE PAST 40 YEARS.
Although I have been retired since 1993, I continue to be very interested in the activities of the insurance industry, especially its actions after Hurricane Katrina. The following is my opinion and recommendations to you.
Due to the limited antitrust exemption in the McCarran-Ferguson Act, casualty insurers have been able to almost perfect their industry into monopsony positions where they can dictate the prices, services, and quality of claims settlements, not only for the auto body collision repair shops, but for home casualty claims and, to a considerable extent, for medical services in our nation.
It is quite simple. Insurers have, over 60 years, collectively and jointly developed the limited insurance products they offer. Not only has the industry limited the products offered, it has, during the 60-year antitrust exemption, structured and perfected the language in its limited products so that the sellers are effectively protected from citizen or state challenges. They have legally defended and perfected the insurance policy wording so that they are shielded from most legal challenges by individual insureds. This enables the insurance companies to jointly offer the consuming public a very limited number of casualty products, while enjoying an overwhelming defense against unwanted liability and claims.
Why can't we buy auto collision group coverages? Why can't we combine into consumer groups and buy home owner's casualty group insurance? Why do the auto insurance companies not compete in offering total or complete restoration of collision- damaged vehicles? Instead, the insurers compete in media claims about slogans and animal symbols.
The auto casualty industry spends a disproportionate amount of its premium dollars controlling the businesses in the automotive collision repair industry. Price competition among the casualty insurers is severely constrained by the lock-step offerings of only a few nearly identical casualty insurance policies.
Auto collision casualty insurers should compete by offering full restoration to pre-loss condition, instead of competing in advertising slogans unrelated to the final quality of collision repairs. Their monopsony control over the auto collision repair industry throughout the county results in millions of "almost repaired" vehicles. This causes millions, if not billions, of dollars in accelerated depreciation losses to vehicle owners, most of whom are unaware of their losses until their vehicles are traded or sold.
Why does the United States government continue to grant this industry a partial antitrust exemption that perpetuates the monopsony domination and control of the automotive collision repair industry?
Additionally, it appears the same insurance industry control over other segments of independent industries is developing. It is clear that the state regulation of insurance companies is not effective in dealing with the issue of monopsony behavior by the casualty insurers.
Imagine the adverse effects on the public if another essential industry could legally act in joint concert to limit the available sensitive products. What if the car companies could agree to offer only six models of vehicles? These essential products could be marketed with very similar sales contracts. The industry control would soon develop into a near monopoly.
Industry agreements to limit competition in available products is not in the best interest of our citizens. Monopsony domination and control of an independent segment of our economy by the insurance industry cannot be adequately controlled by state regulation of the insurance industry.
The many millions, if not billions, of dollars in accelerated depreciation in vehicles repaired under the monopsony control of the auto insurers calls for the U.S. Congress to step into this out-of-control insurance industry and correct the despicable, harmful, and corruption breeding system.
Additionally, the billions of dollars in unpaid storm damages must not be swept under the heaps of piles of debris all across our nation. State regulation of insurance is ineffective. Real competition in insurance products must be revived. Competition in fair claims settlements must be assured by federal regulation of the business of insurance. Comprehensive, fair, carefully developed federal regulations must replace the make-believe state attempts at regulating the insurance industry.

Donald A. Randall
Retired, Washington, D.C., Legal Counsel for the Automotive Service Association
Florida

May 1, 2007
Lawsuit alleges that State Farm, one of the nation's largest automobile insurance carriers, conspired to defraud its policyholder. State Farm then asks court to hide the evidence.
http://www.tlpj.org/briefs/foltz1.htm

State Farm April 30, 2007

Blue Cross/Blue Shield companies ordered to pay $128 million for previously denied claims
Doctors and Medical Societies claim that the insurers conspired to cheat them out of full payment.
http://online.wsj.com/article/SB117771536635085435.html?mod=todays_us_page_one

April 12, 2007

'Damaging' Internal E-Mails Blast State Farm on Katrina Damage Claims'
Internal company e-mails obtained by ABC News reveal that engineers complained of being pressured by State Farm Insurance to change damage reports of homes ravaged by Hurricane Katrina.
http://blogs.abcnews.com/theblotter/2007/04/damaging_intern.html

April 10, 2007

Insurance Giant Accused of Bullying Customers
Progressive Insurance is the target of a $40 million lawsuit that claims the company steers customers away from Independant repair shops.
http://www.fox23news.com/news/local/story.aspx?content_id=65fdca0c-0bf9-4c25-83b2-5122342ba501

March 25^th, 2007

Mississippi Attorney General lays out case against State Farm's denial of Katrina home owner claims.

In a lengthy letter to the Wall street Journal, dated March 23, Jim Hood, Attorney General for the state of Mississippi, gives readers a peek into the evidence files that are causing State Farm so many problems. (click here) (next week, read Claim Reporter's editorial feature on Katrina )