Jared Faerber of The Faerber Law Firm

Insurance companies deliberately delay, deny, and defend automobile accident injury claims in Utah and other states around the country.  CNN and Anderson Cooper, among others, have conducted extensive investigations to reveal these types of practices in the insurance industry. 

Former insurance industry insiders have reported strategies implemented by many insurance companies to limit and deny legitimate claims in minor injury cases.  As a result, insurance companies have reaped billions of dollars in profits.  Have the companies passed on these profits to consumers in the form of lower premiums?  Hardly.  Premiums are as high or higher than ever. 

Three elements were the focus of the strategy: delay, deny and then defend the claims in court.  The insurance industry claims these strategies were not to be used against legitimate claims, but only to fight fraud.  The individuals highlighted in CNN’s report, however, say otherwise.  Injured parties would be forced to spend years and years in court in an attempt to resolve even small claims.  In my years of experience as a Utah personal injury lawyer, I’ve also seen insurance companies such as Allstate, State Farm, and Farmers deny legitimate claims and fight aggressively to avoid paying fair value. 

The insurance industry has also fought a new Washington State law requiring insurance companies who deny legitimate claims and later lose in court to pay three times the damages, plus attorneys’ fees.  Known as the Fair Conduct Act, this law passed the legislature and was signed by the governor of Washington.  Insurance companies have filed a referendum to try to get the law off the books.  They have spent millions on television commercials and other advertising to defeat the law.   If the industry is only using its deny, delay, and defend strategy on fraudulent claims, why are they so afraid of this law? 

According to the story, in 2005, homeowner’s and auto insurance companies made a record 44.8 billion in profits, a 19% increase from 2004.  The industry again made record profits in 2006, and continued to do well in 2007.  Of course there is nothing wrong with making a profit, but doing so through dishonest practices on the backs of the injured is horrible. 

For the complete CNN story, see:

http://www.youtube.com/watch?v=IvPW087RiJ8&feature=related