Insurance company mottos attempt to reinforce a sense of security:"You're in Good Hands With Allstate," "Like a Good Neighbor, StateFarm is There," and "Nationwide is on Your Side."
Insurance should provide security against unexpected problems. Thequestion is, are you really in good hands with Allstate? For thatmatter, how much like a good neighbor is State Farm? And, isNationwide actually on your side?
Here is one example of how Allstate uses its "good hands." AWashington woman was severely injured when a car ran a stop sign andhit her minivan. Her seatbelt failed and she flew out of her vehicle.She suffered severe head injuries which resulted in blindness in oneeye and the loss of sensation in her lips, forehead and scalp.
Allstate's adjuster offered $25,000 to settle this claim. The womanaccepted the offer even though she had over $75,000 in medical bills.Allstate's release made the woman sign away her right to pursue anyfurther recovery. Because her seatbelt failed, the woman had apotential claim against the manufacturer of her minivan (which waslater recalled because of the problem).
The woman eventually filed a lawsuit against Allstate alleging (amongother things) that the Allstate adjuster was improperly practicinglaw. Advising a person about the effect of a legal document ispracticing law. Allstate is under investigation in many statesregarding allegations that its employees are illegally practicing law.
This case was one of the first to use a copy of Allstate's internalclaims manual outlining its policies. Allstate attempted to preventthe information in this case from being discussed, lest people wonderif they really are in "good hands." The King County Superior Court,however, recently unsealed some of the case documents.
Allstate's claims manual, as uncovered by this litigation, is aninteresting document. It contains role-playing guides on how to dealwith people who are not represented by attorneys. It discussesAllstate's findings that "[attorney] represented claims settle for 2-3times more than unrepresented claims." Whether or not Allstate'sstatistics are correct, it goes without saying that Allstate wouldprefer to settle claims for less rather than more.
No lawyer should promise two to three times higher settlements simplybecause of representation. The internal documents are certainly notguarantees. They do suggest, however, a corporate policy to discouragepeople from seeking legal representation. Allstate's claims manual isat times explicit. Here are some excerpts:
"Regular[ly] follow-up claimant to reduce the need for attorneyinvolvement."
"establish a trust-based relationship" with the injured person.
"We will move... to more customer-focused goals such as % of claimants who remain unrepresented..." [italics added]
Allstate has carefully crafted the movements of its "good hands."According to an internal discussion guide, "it is critical thatdeviations from the recommended script are not advised".
Any insurance company that settles thousands of claims a monthunderstandably would want to do so as efficiently as possible. Thisefficiency is rarely in the interest of the injured person, however.Without a good attorney, injured people do not have access toinformation or the full power of the courts.
Bob Anderton practices law in Seattle, specializing in ethicalpersonal injury claims. He can be reached at (206) 262-9290,bob@andertonlaw.com, or www.andertonlaw.com.
