BACH TALK: Whoomp! (there it is)

In a recent blog, a Texas lawyer revealed an industry secret that is common knowledge to policyholder advocates and claimants but rarely publicly revealed or admitted by insurers:  By dragging out claims and failing to timely pay benefits owed, insurers can pressure policyholders to accept lower settlement offers and profit by retaining and investing funds that rightfully belong to their customers. While we know these things to be true, seeing an insurer-side attorney blatantly endorse the practice is a stark reminder of how critical it is that we have strong laws on the books to deter and punish unfair delays and how essential it is that regulators, judges, and policyholder attorneys enforce and not undermine those laws.

The Texas lawyer’s recent revelation should cause public officials to step up enforcement and increase penalties for unfair claim delays. It should compel regulators and legislators to reject insurers’ current “social inflation” PR and lobbying campaign and keep their focus on deterring insurers from intentionally delaying claim payouts.  Our legal system does an excellent job of effectively weeding out frivolous lawsuits. As soon as a journalist caught and shared the blog post, the law firm removed it from their website, but it’s captured below for your reading displeasure.

Unfair claim delays are among the most frequent complaints that consumers regularly report to United Policyholders. and a constant theme in the disputes that are brought to our staff, partners and volunteers through the various channels we use to keep tabs on the insurance marketplace. 

In “Delay, Deny, Defend: Why Insurance Companies Don’t Pay Claims and What You Can Do About It”, Jay M. Feinman, Portfolio, 2010) and “From Good Hands to Boxing Gloves: The Dark Side of Insurance,” (David Berardinelli, Trial Guides Press, 2008) the authors present numerous examples of what United Policyholders hears about every day from consumers who seek our help.

PDF: Is Delaying An Insurance Claim An Effective Defense Strategy?

 

See Retraction Statement: