1,309 in La. File Complaints Against Insurance Companies

November 23, 2005

Home and car owners in Louisiana have filed 1,309 complaints against their insurance companies since hurricanes Katrina and Rita, and few have been resolved, according to the state Department of Insurance.

The Associated Press and the Baton Rouge Advocate reported that according to Insurance Commissioner Robert Wooley, the most common complaint is that claims checks are too slow in coming. Wooley said that may be caused by “double adjusting” – sending out an in-house claims adjuster to double-check a contractor’s assessment.

“I told them if they’re doing it, they need to stop because they’re slowing down the process,” Wooley said.

Wooley said the number of formal complaints is less than 2 percent of the 25,000 consumer contacts the department has had since Hurricane Katrina. In a normal year, the department handles 16,000 consumer calls.

One reason many hurricane calls didn’t escalate into formal complaints is that the department set aside office space for insurance companies’ senior claims agents, Wooley said.

He said that if the department notices a complaint pattern developing, it tells those agents, who can quickly navigate their firm’s bureaucracy to fix the problem.

But J. Robert Hunter, director of insurance for the Consumer Federation of America, said the number of people upset with their insurance company is undoubtedly much higher. Many people don’t even know the department exists, he said.

“Very few people call the Insurance Department,” Hunter said. “At most, a very tiny fraction of the people complaining to their insurance company, less than 1 percent, file complaints with the Insurance Department.”

Given that ratio, he said, probably more than 100,000 people have protested to insurers about their treatment since the hurricanes. People are more likely to sue an insurance company than to call the Insurance Department, he said.

Department spokeswoman Bobby Clark said other complaint categories include:

-Problems getting additional living expenses.
-Lower-than-acceptable claim settlements from their insurance company.
-Less than prompt response from their insurance company.

“They’re all of the things that you get at this stage of the game,” Clark said.

Insurance companies have responded to about 860 of the complaints made through the department, Clark said. She said the complaints have been remarkably well-distributed, with more than 60 companies involved in the 860 complaints for which the department has received a reply.

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