The "Good Hands" people over at Allstate sure have a strong grip when it comes to holding onto documents demanded by the government. The carrier had its license suspended in Florida this week for failing to cough up everything the state wants in its probe of property insurance rate-setting. Meanwhile, it can't shake a fine of $25,000 a day for refusing to hand over an infamous consultant's report, supposedly on how to stall claims--"a kind of holy grail for plaintiff lawyers nationwide," notes the "Kansas City Star," whose readers rightfully hammered the insurer online.
To read more about Allstate's problems in Florida, click here. But today I'd like to share with you some of the angry feedback provided by readers in the Show-Me State.
Missouri courts want Allstate to turn over a report by McKinsey & Company that was the focus of a devastating cover story, "The Insurance Hoax," last year in "Bloomberg Markets" magazine. (See my Sept. 4, 2007 blog entry for details.) The carrier absolutely refuses to cooperate, arguing that the material amounts to proprietary trade secrets, and has run up fines of some $2.4 million as a result.
You can read all about the latest developments in Missouri by clicking here. But check out some of the reader responses to the Star's online article:
--"Allstate is not above the law. I'll think about changing companies."
--"The 'good hands' people? Slight of hand, maybe. Or the hands-in-your-pocket people."
--One independent broker fishing for business among disgruntled Allstate policyholders posted that: "These companies think they're invisible to the court system. We should know, since we have to represent many." He then posted his Web address.
--"It's not just Allstate, it's most of these insurance companies. They strategize to protect their shareholders, which is fine to a point, but not when you cross the line of morals and ethics just to save a buck."
--"Anyone who professionally deals with Allstate knows that they will fight any claim (no matter how meritorious it is) like a junkyard dog. I suppose there are people who believe that is what an insurance company should do."
--"All carriers do the same thing. Claimants are forced to settle for pennies on the dollar or go to trial and pay thousands of dollars out of pocket to get a fair payment by the carrier. This is a business decision by carriers to ensure that that the little guy gets adequately hosed. Get your legislature to change the laws which protect and encourage these actions."
--I'll conclude my unhappy recap with the sharpest jab in the bunch: "Why do they call 'Allsnake' the 'Good Hands' people when all they give you is the finger?"
To be fair, some respondents did come to Allstate's defense:
--"I've had great service with Allstate. People are always looking for a conspiracy."
--"Remember to not complain about rising premiums when you're trying to scam your insurance company for money when you have a minor fender bender."
Once again, a major player in the insurance industry is cutting off its nose to spite its face. Allstate, by going to such extreme lengths to protect whatever dark secrets are in the McKinsey documents, look as if they have something terrible to hide--the truth, perhaps, about how they intentionally manhandle claimants? If not, why not come clean?
Allstate should turn over the damned documents already and put this travesty behind them before their reputation is damaged beyond repair, or more states revoke their license.
In the meantime, they are dragging the industry's already tarnished image down with them.
Comments (6)
And if there is a soul who believes this is something even remotely new for Allstate, think again.
Forty-five years ago, I dated a paralegal who worked for a group of lawyers who represented Allstate, and it was the same tune back then, according to her.
Wow, 45 years to be thinking you could be in "good hands" and then the day they're needed, it's the same old "whoops"!
Posted by B.J. | January 16, 2008 8:38 PM
Posted on January 16, 2008 20:38
As Pogo once said; "We done met the enemy and it be us!"
Posted by J.R. | January 16, 2008 11:23 PM
Posted on January 16, 2008 23:23
Between 1979 and 1987, I worked for and then owned an independent insurance agency. During those years, about 30 people visited who were desperate for help with denied or mishandled claims--allegations of being cheated by their insurer. More than half of these involved Allstate.
After being deceived by a very likeable, believable Allstate rep, I started a scratch Allstate agency in 2004 ... BIG MISTAKE ... GOT OUT QUICK! They're no different than they ever were! Short-term, fast-buck philosophy and just advertise a lot to replace the dissatisfied former customers AND AGENTS!
As a former resident of St. Louis, Mo. ... I say MAKE 'EM SHOW YOU!!! And ... GO FLORIDA! I'll bet there's fire behind all of this smoke.
Posted by Joe Zinobile | January 17, 2008 11:39 AM
Posted on January 17, 2008 11:39
All the Mckinsey's and other consultants can all tell the carriers how much they can save by delaying claims, etc.. However, they forget about how that affects customer relations.
The independent agents will be the long-term beneficiaries of all the legal action against Allstate and State Farm.
What is most unfortunate is that all the wonderful insurance companies in the marketplace will also be painted by the same brush of public opinion.
Posted by Dick Natalizio | January 19, 2008 6:21 AM
Posted on January 19, 2008 06:21
Allstate, 'the good hands people?'
Historically, Allstate has proven this is an oxymoron going back to Alan King symbolically putting out his hands per the 'good hands people' logo and sticking up his middle fingers.
It hasn't changed.
Hiding behind 'proprietary' information has been a typical industry get-out of full disclosure ploy.
What does Allstate have to fear? Getting the Outstanding Claims Service Award of 2007?? (Please note the sarcasm.)
Posted by Jim Schwartz | January 21, 2008 1:47 PM
Posted on January 21, 2008 13:47
I have worked for Allstate for several years. People have no idea of what this company is about. They would be shocked, and if Allstate was ever really exposed, they would lose customers by the thousands, if not bankrupt them.
Posted by R.D. | January 31, 2008 9:29 PM
Posted on January 31, 2008 21:29