When someone in Grand Prairie, Hurst, Euless, Bedford, Fort Worth, Dallas, Irving, Carrollton, or anywhere else in Texas makes a claim with their insurance company, they expect the claim to be paid promptly.
Here is something to get you upset.
According to an unpublished Harris Interactive Poll conducted in September, 16 percent of surveyed adults have experienced financial hardship while waiting for an insurance claim to be settled or know someone who has. The same poll found that 59 percent of adults believe that most insurers intentionally delay claims — and those with an income of $35,000 or less were more likely to agree.
With 15.3 percent of Americans — about 46.2 million people — living in poverty, close to 10 percent unemployment, and roughly 2 million people who’ve been looking for work for more than two years, Allstate’s business model is profiting off many consumers at their most vulnerable. A claim delayed by even a month can spell financial disaster for a family. As a National Bureau of Economic Research study found, about 25 percent of Americans could not come up with $2,000 in a 30 – day period.
One Allstate customer, Burdett, a retiree, reported her experience on the website AllstateInsuranceSucks.com. When her Georgia home burned in November 2010, she was in Ohio, where she lives most of the year. She said the fire marshal in Georgia told her that her house would have to be torn down.
The next day her Allstate adjuster, told her the house could be repaired. Allstate also said it would have to do a thorough investigation to determine if the fire was caused by arson. If it was arson, the adjuster told her, Allstate would not pay for any damages. According to former employees, such investigations are a common practice at Allstate and are encouraged by supervisors as a way to avoid paying claims quickly.
Burdette, who lives on her Social Security checks, flew from Ohio to survey the damage herself. While in Georgia, she contacted public adjuster Anita Taff. Public adjusters serve as advocates for individuals who feel they need another set of eyes on a claim. Taff met with Burdette at the house, Burdett said, and discussed the damage with the contractor Burdett had hired. Upon returning to Ohio, Burdett spoke with Taff over the phone to find out what her impression was. Burdette said Taff warned her that the contractor might go along with Allstate’s insistence that the house could be repaired.
Taff stated that she believed, delaying claims is an effort to put the squeeze on policyholders. She explained that while a claim is being held up, the insurance company may stop paying the policyholder’s additional living expenses, forcing the policyholder to cover mortgage and rent entirely out of pocket. Taff said, “That is something that many people cannot afford to do, so they’re forced to take a lower settlement,”
Burdette said she immediately called the contractor and told him not to go near her house. According to Burdette, she received a phone call within 10 minutes from her Allstate adjuster asking her not to hire Taff or any other public adjuster. “He said, ‘If you hire a public adjuster, I’m going to deny and delay this claim for as long as possible.'” Taken aback, she then asked if it wasn’t in his best interest to settle the claim. “Not really,” was the reply according to Burdette.
Although the Allstate adjuster eventually agreed to work with Taff on Burdette’s claim, her troubles did not end. The contractor who had been banned from her property nevertheless worked on the house and billed Allstate for $22,000. Burdette had explicitly told Allstate not to pay the contractor a dime, she said, but the company paid him under her policy anyway.
Now, more than a year later, Burdette’s home is still being repaired and Allstate refuses to reimburse the $22,000. She consulted four different lawyers to see if she had a legal case. While she said they all agreed that she was entitled to reimbursement, she said they also agreed that she lacked the funds to fight the insurance giant. “They told me, ‘You’ll run out of money.'”
For Texans, an experienced Insurance Law Attorney can help by using the Texas Insurance Code and the Prompt Payment of Claims Act.
Updated: