I particularly liked your point on insolvency. I think Joanna\’s idea of how an insurance company should be run goes like this:
1) Collect premiums that the insureds will like. (I personally would like to pay $5 a year, how about you?)
2) Hurricane/Earthquake Bobby rolls through.
3) Insurance company only collected $2,000 and needs to pay out $2,000,000.
4) Insurance company is insolvent (can not pay all of their debts).
5) Insurance company files for bankruptcy.
6) Insureds don\’t even get their $5 investments back.
Funniest thing she said though…
\”I would rather sell life insurance for a profit.\”
Guess we know why she doesn\’t like the insurance company to be making all the money. Then she can\’t buy her Prada sunglasses.
*The above comment does not mean I am in favor of insurance companies not paying valid claims. But, if you live in a flood/earthquake prone area- BUY THE COVERAGE.
\”They just want the premiums and leave it up to the adjuster to explain the coverages!\”
That line is funny. A lot of insurance agents seem to embody that mindset (#1). Others are happy to explain coverages (properly even! #2), others try to explain coverages but insureds don\’t have time or don\’t even want to hear it (#3). Others try to explain coverages but really don\’t have a clue what they are doing (#4).
I think Joanna sounds like #1 and #4.
The part about adjusters explaining coverage (obviously after the fact) had me rolling. Good point!
Thank you Anne
If Joanna calls you a name, just consider the source.
They profit 99% of the time.
Whey they owe, they defend with high profile Attorneys.
They bully Americans and Own Officials
because they Grease Them In The Lobby.
It is not a secret. Campaign Contributions are clearly available.
If they would stop contributing to elections, stop spending millions on tv ads that claim good neighbors and good hands, and stop spending millions for the legal defense, they would be able to pay claims without blinking one eye.
We\’re tired of being treated like hound dogs then to be repremended by fellow Americans for fighting back is insult to injury. We got ours, you will get yours.
What a Victory to see the ole Boys in the Band, go after them and win too!
Let\’s hear it for the boys…MS won.
It\’s a start.
there are bad agents, and bad adjusters…and…gasp…bad insureds. There\’s bad people everywhere; that\’s why we need Batman and Robin, even if they\’re only comic book characters.
Simply because there is a bad example available does not allow for use of a onesizefitsall paintbrush to flush an industry. I see the claims end of the business; I\’ve dealt with thousands of plaintiff attorneys over the years. Some are crooks, some are great guys/gals who really care about their clients. Do we need them: yes, because without them, many folk will \’behave less appropriately\’. Are they always fair with me? No, but they say the same thing about me.
Gil made an excellent point: for those agents who take the time to explain and UNDERSTAND (the U word) there is allot of opportunity. Unfortunately, there are some order takers out there who don\’t explain.
Regardless, it doesn\’t excuse anyone from READING (the R word) the policy. And if you can\’t afford the coverage (like Joanna\’s clients who still buy life insurance so their kin can someday buy a HO policy from her), maybe you bit off more than you can chew on your property?
Gill never said anything about company profits to that end. Why should he explain that to you?
Claims that are legitimate should be paid. If yours isn\’t valid, that\’s TOO BAD.
The only thing I call into question is if the insurance companies are fair in deciding if a claim is legitimate. I am sure they have denied many valid claims.
Let\’s try this scenario:
You own a dry cleaning business. Someone comes in with a dry cleaning ticket that belongs to another store. They want to pick up their Armani suit. You don\’t have it; it\’s at the cleaners down the street. You\’re the most profitable dry cleaning business in town. I guess you would give them someone else\’s Armani suit if it made them shut up, huh? I mean, after all, you make lots of money. Why wouldn\’t you want to just give away $$$ (and valuable items) to people who don\’t hold the right ticket (ie. invalid claim)? Oh that\’s right, because you are trying to run a business.
P.S. I tried to dumb the scenario down as much as possible.
You are (usually) a delight! I say that because I don\’t always like your posts ;) (and you can say the same about me). That part was just a little joke. I do love your posts; I don\’t always agree, but they are great nonetheless.
You\’re exactly right on your point about good and bad. There is good and bad in every industry. A chain restaurant in Chicago with bad service and roaches vs. the same restaurant in Detroit with immaculate surroundings and wonderful people, etc…
My FAVORITE part of your post though:
\”And if you can\’t afford the coverage (like Joanna\’s clients who still buy life insurance so their kin can someday buy a HO policy from her), maybe you bit off more than you can chew on your property?\”
I am sure Joanna will say that at the time of purchase the home was within their means. Of course, they had to take ALL of the money out of savings to buy the house with the extra bathroom. Now they can\’t afford to pay for it all. How many homes are going into foreclosure because people had BIG EYES (and smaller wallets) during the big housing boom in Florida the past couple of years? Savings are necessary for a reason (and no, I don\’t mean Coach hand bags Joanna).
I really liked this post. One of the best you\’ve scripted. :)
Thanks
P.S. I did love the life insurance post too. It made me fall out of my chair.
Rosie, where is your logic? I have a savings account, does it imply I am ripping off my creditors?
It\’s basic accounting. Carriers have homeowner divisions, auto divisions…they also pool the premiums and losses by state.
Louisana produced huge losses in 2005. But that doesn\’t mean a carrier could not be profitable in TX, MO, or Idaho. At the end of the year, they compare their premiums to their losses. If they took in more premium than losses and expenses, then it\’s a profit. If they paid more out…a loss.
Simply because a large loss to a carrier occurs in LA, MS, or FL, that does not imply losses were great elsewhere. It\’s called spreading risk. Regardless, it has nothing to do with the losses. If they are covered losses under the policy, they should be paid. If they are not covered, they should be denied. The fact that a carrier makes a profit does not deny them their duty to disallow those losses they do not feel are covered. Paying losses NOT covered under the policy would not be a smart practice.
Profit has not been banned yet in this country, at least not yet. Profit actually allows carriers to rebuild reserves. There have been many years where major carriers were losing money, yet I didn\’t see anyone complaining they were paying too many losses, or should be allowed to deny additional covered losses simply because they were losing money then.
The risk is different thoughout the country. Homeowners coverage has historyically not been a profitable business; many carriers offer it so they can keep customers in their auto lines; many prefer to buy their insurance from one carrier. Please note there are many large auto carriers who do not offer homeowners. If it was such a profitable part of the pie, they\’d all want to offer it.
thankfully. We call the other 1% insolvent. Joanna and Rosie seem to imply that profit is bad. Where are you birds from anyway? China, Cuba, Korea?
Do you both operate at a loss? What would you call it if you paid out each month more than you brought in? Bankruptcy. And if that happens to you two socialists in our country then you get your high priced attorney to bail YOU
out so that the rest of us can pay your way. Kind of like the Guaranty Association works for the insurance industry. You know, the insurers who run it right and charge (gasp) the right amount bail out the freeloaders. As far as high priced attorneys – how often is the contract really challenged. We pay from my little agency hundreds of claims every year. Neither my company or my insureds have seen fit to challenge the contract in fifteen years of agency.
Can there be disagreements over these contracts which, by the way, have evolved over hundreds of years? Hell yes. But just because two sides disagree doesn\’t mean the insurers are automatically wrong. How often do plaintiffs prevail?
And attorneys devise the contracts – who do you think will defend them? Who has a better understanding. You whiners don\’t like the defendents to have representation but conveniently overlook that the plaintiffs certainly do as well.
Quit complaining and do something yourselves. Our industry is a part of the solution, not the problem. By the way, what do you call 1000 attorneys at the bottom of the ocean? A good start.
Don\’t care if the Company made a profit
because you can\’t loose.
I care because thousands of people lost their business and were denied Interruption Benefits too.
These business owners had to apply to the SBA for loans, lost their homes & business. While the Insurance Companies that we paid, denied our claims and then refered to the loopholes hidden in the policy. Cleaver but shreud.
Why didn\’t the Insurance Industries apply to the SBA? They never had too,they denied claims, then allowed US to pick up the tab. Flood & Grants paid your tab.
You sat back like spiders, trying to figure a way to get out of this one and you fought this exposure, All of the way.
Business is Business.
Yes, you need & want profit. When you sell a product that is defective, it\’s a matter of time before you are made accountable for your mistakes and if there is intent to defraud, that makes your more accountable.
Can all of these people be wrong?
If they misread or did not read the policy, then why didn\’t the Agent explain to the Insured that they Do Not Have Hurricane Insurance if flood waters arrive.
Even though you have a Hurricane Deductible, don\’t think that you have Hurricane Insurance.
The Agent should have mandated flood insurance and explained this to their proposed insured.
Reiterating the fact that if you live outside of a flood zone, your homeowners insurance (is off of the hook) is voided and you will not be paid for wind claims.
You will not have a valid claim for hurricane damage if flood water is present. You will not be able to sue the company for denying claims.
Simple, Honest and Fair.
It\’s the right thing to do.
Seems you guys insist upon Getting One Over On People.
To claim this foul because Senator Lott would like you to put this in writing,
only shows that you insist upon hiding the most important
exclusions in your policy.
If the Industry would be honest, Lawyers would not be needed.
We are profiting from your lack of honesty
\”If they misread or did not read the policy, then why didn\’t the Agent explain to the Insured that they Do Not Have Hurricane Insurance if flood waters arrive.
Even though you have a Hurricane Deductible, don\’t think that you have Hurricane Insurance.
The Agent should have mandated flood insurance and explained this to their proposed insured.\”
I am sure lots of agents did try to explain. However, after reading your posts, I can see why you didn\’t understand them.
\”To claim this foul because Senator Lott would like you to put this in writing,
only shows that you insist upon hiding the most important
exclusions in your policy.\”
Why is it so hard to understand that FLOOD damage is excluded from a standard policy? If flood coverage wasn\’t excluded, they wouldn\’t need to offer it separately. The same goes for earthquake coverage, etc.
Duh…
\”We are profiting from your lack of honesty\” Do you mean we as in you and your fellow misguided citizens? If you do, then you REALLY make no sense.
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Excellent post Gill Finn!
I particularly liked your point on insolvency. I think Joanna\’s idea of how an insurance company should be run goes like this:
1) Collect premiums that the insureds will like. (I personally would like to pay $5 a year, how about you?)
2) Hurricane/Earthquake Bobby rolls through.
3) Insurance company only collected $2,000 and needs to pay out $2,000,000.
4) Insurance company is insolvent (can not pay all of their debts).
5) Insurance company files for bankruptcy.
6) Insureds don\’t even get their $5 investments back.
Funniest thing she said though…
\”I would rather sell life insurance for a profit.\”
Guess we know why she doesn\’t like the insurance company to be making all the money. Then she can\’t buy her Prada sunglasses.
*The above comment does not mean I am in favor of insurance companies not paying valid claims. But, if you live in a flood/earthquake prone area- BUY THE COVERAGE.
\”They just want the premiums and leave it up to the adjuster to explain the coverages!\”
That line is funny. A lot of insurance agents seem to embody that mindset (#1). Others are happy to explain coverages (properly even! #2), others try to explain coverages but insureds don\’t have time or don\’t even want to hear it (#3). Others try to explain coverages but really don\’t have a clue what they are doing (#4).
I think Joanna sounds like #1 and #4.
The part about adjusters explaining coverage (obviously after the fact) had me rolling. Good point!
Thank you Anne
If Joanna calls you a name, just consider the source.
They profit 99% of the time.
Whey they owe, they defend with high profile Attorneys.
They bully Americans and Own Officials
because they Grease Them In The Lobby.
It is not a secret. Campaign Contributions are clearly available.
If they would stop contributing to elections, stop spending millions on tv ads that claim good neighbors and good hands, and stop spending millions for the legal defense, they would be able to pay claims without blinking one eye.
We\’re tired of being treated like hound dogs then to be repremended by fellow Americans for fighting back is insult to injury. We got ours, you will get yours.
What a Victory to see the ole Boys in the Band, go after them and win too!
Let\’s hear it for the boys…MS won.
It\’s a start.
there are bad agents, and bad adjusters…and…gasp…bad insureds. There\’s bad people everywhere; that\’s why we need Batman and Robin, even if they\’re only comic book characters.
Simply because there is a bad example available does not allow for use of a onesizefitsall paintbrush to flush an industry. I see the claims end of the business; I\’ve dealt with thousands of plaintiff attorneys over the years. Some are crooks, some are great guys/gals who really care about their clients. Do we need them: yes, because without them, many folk will \’behave less appropriately\’. Are they always fair with me? No, but they say the same thing about me.
Gil made an excellent point: for those agents who take the time to explain and UNDERSTAND (the U word) there is allot of opportunity. Unfortunately, there are some order takers out there who don\’t explain.
Regardless, it doesn\’t excuse anyone from READING (the R word) the policy. And if you can\’t afford the coverage (like Joanna\’s clients who still buy life insurance so their kin can someday buy a HO policy from her), maybe you bit off more than you can chew on your property?
Gill never said anything about company profits to that end. Why should he explain that to you?
Claims that are legitimate should be paid. If yours isn\’t valid, that\’s TOO BAD.
The only thing I call into question is if the insurance companies are fair in deciding if a claim is legitimate. I am sure they have denied many valid claims.
Let\’s try this scenario:
You own a dry cleaning business. Someone comes in with a dry cleaning ticket that belongs to another store. They want to pick up their Armani suit. You don\’t have it; it\’s at the cleaners down the street. You\’re the most profitable dry cleaning business in town. I guess you would give them someone else\’s Armani suit if it made them shut up, huh? I mean, after all, you make lots of money. Why wouldn\’t you want to just give away $$$ (and valuable items) to people who don\’t hold the right ticket (ie. invalid claim)? Oh that\’s right, because you are trying to run a business.
P.S. I tried to dumb the scenario down as much as possible.
Chad,
You are (usually) a delight! I say that because I don\’t always like your posts ;) (and you can say the same about me). That part was just a little joke. I do love your posts; I don\’t always agree, but they are great nonetheless.
You\’re exactly right on your point about good and bad. There is good and bad in every industry. A chain restaurant in Chicago with bad service and roaches vs. the same restaurant in Detroit with immaculate surroundings and wonderful people, etc…
My FAVORITE part of your post though:
\”And if you can\’t afford the coverage (like Joanna\’s clients who still buy life insurance so their kin can someday buy a HO policy from her), maybe you bit off more than you can chew on your property?\”
I am sure Joanna will say that at the time of purchase the home was within their means. Of course, they had to take ALL of the money out of savings to buy the house with the extra bathroom. Now they can\’t afford to pay for it all. How many homes are going into foreclosure because people had BIG EYES (and smaller wallets) during the big housing boom in Florida the past couple of years? Savings are necessary for a reason (and no, I don\’t mean Coach hand bags Joanna).
I really liked this post. One of the best you\’ve scripted. :)
Thanks
P.S. I did love the life insurance post too. It made me fall out of my chair.
Rosie, where is your logic? I have a savings account, does it imply I am ripping off my creditors?
It\’s basic accounting. Carriers have homeowner divisions, auto divisions…they also pool the premiums and losses by state.
Louisana produced huge losses in 2005. But that doesn\’t mean a carrier could not be profitable in TX, MO, or Idaho. At the end of the year, they compare their premiums to their losses. If they took in more premium than losses and expenses, then it\’s a profit. If they paid more out…a loss.
Simply because a large loss to a carrier occurs in LA, MS, or FL, that does not imply losses were great elsewhere. It\’s called spreading risk. Regardless, it has nothing to do with the losses. If they are covered losses under the policy, they should be paid. If they are not covered, they should be denied. The fact that a carrier makes a profit does not deny them their duty to disallow those losses they do not feel are covered. Paying losses NOT covered under the policy would not be a smart practice.
Profit has not been banned yet in this country, at least not yet. Profit actually allows carriers to rebuild reserves. There have been many years where major carriers were losing money, yet I didn\’t see anyone complaining they were paying too many losses, or should be allowed to deny additional covered losses simply because they were losing money then.
The risk is different thoughout the country. Homeowners coverage has historyically not been a profitable business; many carriers offer it so they can keep customers in their auto lines; many prefer to buy their insurance from one carrier. Please note there are many large auto carriers who do not offer homeowners. If it was such a profitable part of the pie, they\’d all want to offer it.
thankfully. We call the other 1% insolvent. Joanna and Rosie seem to imply that profit is bad. Where are you birds from anyway? China, Cuba, Korea?
Do you both operate at a loss? What would you call it if you paid out each month more than you brought in? Bankruptcy. And if that happens to you two socialists in our country then you get your high priced attorney to bail YOU
out so that the rest of us can pay your way. Kind of like the Guaranty Association works for the insurance industry. You know, the insurers who run it right and charge (gasp) the right amount bail out the freeloaders. As far as high priced attorneys – how often is the contract really challenged. We pay from my little agency hundreds of claims every year. Neither my company or my insureds have seen fit to challenge the contract in fifteen years of agency.
Can there be disagreements over these contracts which, by the way, have evolved over hundreds of years? Hell yes. But just because two sides disagree doesn\’t mean the insurers are automatically wrong. How often do plaintiffs prevail?
And attorneys devise the contracts – who do you think will defend them? Who has a better understanding. You whiners don\’t like the defendents to have representation but conveniently overlook that the plaintiffs certainly do as well.
Quit complaining and do something yourselves. Our industry is a part of the solution, not the problem. By the way, what do you call 1000 attorneys at the bottom of the ocean? A good start.
Don\’t care if the Company made a profit
because you can\’t loose.
I care because thousands of people lost their business and were denied Interruption Benefits too.
These business owners had to apply to the SBA for loans, lost their homes & business. While the Insurance Companies that we paid, denied our claims and then refered to the loopholes hidden in the policy. Cleaver but shreud.
Why didn\’t the Insurance Industries apply to the SBA? They never had too,they denied claims, then allowed US to pick up the tab. Flood & Grants paid your tab.
You sat back like spiders, trying to figure a way to get out of this one and you fought this exposure, All of the way.
Business is Business.
Yes, you need & want profit. When you sell a product that is defective, it\’s a matter of time before you are made accountable for your mistakes and if there is intent to defraud, that makes your more accountable.
Can all of these people be wrong?
If they misread or did not read the policy, then why didn\’t the Agent explain to the Insured that they Do Not Have Hurricane Insurance if flood waters arrive.
Even though you have a Hurricane Deductible, don\’t think that you have Hurricane Insurance.
The Agent should have mandated flood insurance and explained this to their proposed insured.
Reiterating the fact that if you live outside of a flood zone, your homeowners insurance (is off of the hook) is voided and you will not be paid for wind claims.
You will not have a valid claim for hurricane damage if flood water is present. You will not be able to sue the company for denying claims.
Simple, Honest and Fair.
It\’s the right thing to do.
Seems you guys insist upon Getting One Over On People.
To claim this foul because Senator Lott would like you to put this in writing,
only shows that you insist upon hiding the most important
exclusions in your policy.
If the Industry would be honest, Lawyers would not be needed.
We are profiting from your lack of honesty
\”If they misread or did not read the policy, then why didn\’t the Agent explain to the Insured that they Do Not Have Hurricane Insurance if flood waters arrive.
Even though you have a Hurricane Deductible, don\’t think that you have Hurricane Insurance.
The Agent should have mandated flood insurance and explained this to their proposed insured.\”
I am sure lots of agents did try to explain. However, after reading your posts, I can see why you didn\’t understand them.
\”To claim this foul because Senator Lott would like you to put this in writing,
only shows that you insist upon hiding the most important
exclusions in your policy.\”
Why is it so hard to understand that FLOOD damage is excluded from a standard policy? If flood coverage wasn\’t excluded, they wouldn\’t need to offer it separately. The same goes for earthquake coverage, etc.
Duh…
\”We are profiting from your lack of honesty\” Do you mean we as in you and your fellow misguided citizens? If you do, then you REALLY make no sense.
Again, I can see why you don\’t understand…