Insurance settlement offer fair? l Car Accident Lawyer

Within the last six months our office has noticed an alarming, but not surprising trend.  For years insurance companies have delayed, denied and defended against policy holder’s accident claims in order to reduce the amounts that are paid out while increasing company profits.  But within the last six months insurance companies have become even more and more aggressive toward claimants.  The economic downturn has caused large corporations such as insurance companies to try to reduce costs and expenses to grow profits.  The policy holders are the losers.  They are paying more and more money for less and less coverage and protection.  And when an accident does happen the insurance companies are fighting harder to keep from paying a fair settlement. 

We have noticed that insurance companies are fighting harder during settlement negations, mediations, arbitrations, and trials.  And small accident claims that would once been easy for someone to settle on their own without the help of an attorney have been fought more rigorously thus driving more and more people to seek the assistance of a lawyer. 

If you believe that the offer from the insurance company is not fair….you are probably right.  If you feel rushed to settle your claim before your medical condition has fully resolved then you may need legal help to manage the situation. 

Our office offers free consultations and we would be happy to discuss your case.  If you do not need the assistance of an attorney we will let you know and give you free books, reports, and information that will help you settle your claim.  If you do need a lawyer then we will do everything that we can to assist you.  Call our office at 206-727-4000 to schedule your free consultation. 

Mischelle Weedman-Davis
Client Relations Manager
Davis Law Group, P.S.
Seattle, WA

The Top Ten Worst Insurance Companies - Washington State Insurance Commisioner

Insurance Dispute Resources l Washington State l Seattle Attorney

• Washington State's Insurance Fair Conduct Act
• Insurance Company "Tricks of the Trade"
• From Good Hands to Boxing Gloves: How Allstate Has Earned Billions by Shortchanging Policyholders & Claimants
• Contempt order that triggered huge fines against Allstate to be lifted
• Insurance Bad Faith: Farmers Insurance bills fire victims $420,000
• Allstate Claims Process Explained
• Health Insurer Ordered to Pay $9 Million for Illegally Terminating Benefits
• Insurance Company Alleged to Have Killed Patient for Refusing to Pay for Treatment
• Insurance Companies Seeking Ways to Mitigate the Insurance Fair Conduct Act (Referendum 67)
• Health Plan Sues Accident Victim to Recover Entire Settlement Recovery

Insurance Company Rules - Watch this Video!!

People often ask me what it's like dealing with insurance companies all day, each week, and every month.  Well, the words that come to mind are: frustrating, irritating, disheartening, disappointing, and blood-boiling, just to name a few.  Most of my clients, particular those who have had to file lawsuits, can certainly relate.

But here's a video that really captures what it's like to deal with an insurance company when it comes time to work out a settlement.  Enjoy it, I certainly did!!  Insurance Company Rules.

From Good Hands to Boxing Gloves: How Allstate Has Earned Billions by Shortchanging Policyholders & Claimants

The book From Good Hands to Boxing Gloves: The Dark Side of Insurance (2008) by David J. Berardinelli, discusses how Allstate revolutionized the claims handling process by implementing policies to deliberately reduce benefits and claim payouts by intentionally paying out less than the true value of the claim. 

Mr. Berardinelli states that our insurance system is founded on two key rules: the indemnity principle and the fiduciary principle. Together these principles are intended to level the playing field between the insurance company and the policyholder. These principles balance the insurer’s legitimate goal of being profitable while allowing the insured policyholders to get prompt and fair payment for covered losses.

Mr. Berardinelli states that casualty insurance is a unique insurance product. It’s different from other kinds of insurance like life insurance. Life insurance pays a set benefit when you die regardless of the cause or consequences of your death. But casualty insurance is indemnity coverage. It doesn’t pay a set benefit. It pays as much as the policyholder needs, up to the policy’s limit, "to restore an insured to the same financial position after the loss that he or she was in prior to the loss."  To indemnify someone means to make them whole again. That means the insured doesn’t get paid more than the actual loss. It also means the insured shouldn’t get paid less than what it takes to make the insured whole again. The insurance company's duty is to pay the full amount the policy holder needs to be put back in the same position he or she was in before the loss.  This is called the indemnity principle.

Mr. Bernadelli states that Allstate implemented a program to intentionally pay out less than the true value of claims.  Essentially, Allstate intentionally violated the indemnity principle, leaving policyholders and claimants much less than the insurance coverage they were entitled to receive.

How did Allstate accomplish this?  Well Allstate often deliberately delays paying legitimate claims by asking for useless information or demanding more proof than it really needs. It would delay payment or force policyholders to jump through needless hoops, in hopes they’ll give up or take less than the full and fair amount of the benefits they’re owed under the policy. Allstate paid for studies which showed that nearly 85% of claimants would accept whatever lowball offer Allstate made, and not bother with the hassle.  When you are talking about hundreds of thousands of claims, this adds up to hundreds of millions saved for Allstate.

Another tactic Allstate uses is to pressure policyholders who are in a financial bind into accepting a quick payment that’s far less than what they need to make them whole. It forces policyholders to file needless, expensive, and time consuming lawsuits as the only way to get what they need to fully restore them to where they were before the loss. Again, Allstate found that most people will not bother to go through the hassle of hiring a lawyer and filing a lawsuit.  More money saved for Allstate.

Mr. Bernadelli found that Allstate repeatedly violated the important principles which are necessary to protect people who purchase insurance.  Yet Allstate continues to get away with its tactics.  Allstate continues to put its own financial interests ahead of their insured’s needs, and now the system is no longer fair. The playing field is no longer level and an insured either accepts less than they receive or seeks legal counsel to level the field.

Insurance Companies Seeking Ways to Mitigate the Insurance Fair Conduct Act (Referendum 67)

The Insurance Fair Conduct Act (formerly Referendum 67) was recently passed by Washington State voters last November.  This new law became effective Dec. 6, 2007.  And insurance companies are seeking ways to mitigate it's impact.  One attorney who represents insurance companies is giving advice to them on his own "insurance law blog." 

All claims brought under the Insurance Fair Conduct Act must be preceded by a 20-day notice of the claim to the insurance company and the insurance commissioner. (The Office of the Insurance Commissioner has created a cover sheet for the notice.)

An action may be brought only if the insurance company fails to resolve the basis for the action.  One defense to the claim is if the carrier relies on a "written opinion" from an "authorized agency" that the claim is still being investigated or that the claim is fraudulent.  If the carrier does not resolve the claim within the required 20 day period, a lawsuit may be initiated.

The Insurance Fair Conduct Act prohibits conduct by the carrier during the claims handling process that is considered "unreasonable."  Presumably, a violation of the claims handling regulations found at WAC 284-30 et seq. would be considered unreasonable and therefore provide a basis under the Act.  If the insured person prevails, the judge may triple the amount of damages.  The judge's decision to triple the damages is discretionary.  Another advantage of the Act is that it provides attorney fees to the successful claimant.  This will allow persons with smaller claims to bring a claim under the Act.  Without such an attorney fee provision, most people could not afford to incur the legal expenses necessary to go after the insurance company for a violation of the Act.

If you believe that you have been treated unfairly and unreasonably by the insurance company, please contact or call Davis Law Group for a free consultation about your rights.  No fee will be assessed to discuss your case.

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