Insurance Company Advertising on TV
October 27, 2008
I was watching television last night and two different shows had insurance company commercials. One was advertising car insurance and the other was advertising for life and disability insurance. These companies drive me crazy with their advertising. Their commercials make it sound like they will make your life so much easier if you have a life altering accident or health issue.
That is certainly not what my clients would tell you is their experience. Sure, these companies are more than happy to take your money. Keep paying premiums and everything is fine. Make a claim, however, and it seems that their goal is to avoid paying benefits at almost any costs.
I just spoke with a man that has his own plumbing and electrical business. Two years ago he was diagnosed with cancer. He required treatments for months. He also had to deal with the emotional component of living with cancer. He had purchased a long term disability insurance policy. He believed that should he ever have to stop working for any significant period of time that he would have a monthly benefit to help him pay the bills. WRONG. His safety net, the long term disability insurance, was denied. Paul Revere Insurance took the position that he was not totally disabled. He could still do the paperwork in the office. What crap. He needed to do physical work to generate the need for the paperwork. Of course he had a few men that worked for him and continued to work for him. But he was not capable of doing his job.
The good news in this situation is that the cancer is in remission and this gentleman has returned to work. The total benefits payable for the period of disability is likely between $15,000.00 and $25,000.00.
So what is the end result of this? Ultimately the court action will eat up significant dollars for the lawyers. Paul Revere Insurance likely believes the amount of the recovery will not justify the costs of suing. That is one of the factors that insurance companies frequently seem to use in denying benefits. In this case, they will be wrong. The court action will take place. The insurer will pay thousands of dollars to a defence lawyer. The insurer, whether the action settles or goes to trial, will also have to pay thousands of dollars to the plaintiff's lawyer (assuming success in the action).
So there you have it. The insurance company appears to be more willing to pay lawyers a significant amount of money to defend a case in which the costs of legal fees and disbursements might ultimately be more than the amount of the benefit payable. How can that make any financial sense? You might think this is a unique situation. It isn't. Time and again I see insurance companies fight a case only to agree in the end to pay damages and legal costs.
There are many tragedies in cases like these. First and foremost you have someone suffering from a horrendous, and frequently, fatal disease. There is unbelievable emotional stress on the individual and his or her family just because of the cancer and the fear that brings. Then there is the fear and stress of the loss of income. Finally, despite paying premiums to the insurance company sometimes for many years, there is the added emotional stress of the application for disability benefits followed by the denial of those benefits.
For every one of these small cases that we take on there are many more similar situations where the person doesn't sue the insurer. Sometimes they never even contact a lawyer. They assume they are not entitled to the benefits because the insurance company told them so. Sometimes they go to a lawyer that will not take cases as small as these. From a business perspective it certainly does not make sense for a personal injury lawyer to invest the time and money required to litigate a case for only 15 or 20 thousand dollars.
So back to my initial rant. The peace of mind the tv commercials talk about costs the person monthly premiums sometimes for years. In the end, often instead of receiving peace of mind when illness, car accident or other cause of disability occurs, the person is given more stress because the insurer simply refuses to pay.
If you want more information on specific insurers you might look on the internet for articles dealing with the worst insurers. There are plenty. Go to the American Association for Justice website and check their archives. If you or a loved one has had a similar experience and want to find a lawyer in your area Injury Alliance can help. In any event, don't let the first denial convince you that you are not entitled. The insurer may be wrong.
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