Here are some stories that may be of interest:
- In Massachusetts politicians recently became unhinged over Insurance Commissioner Burnes’ plan for limited auto insurance competition and made numerous dumb statements to the press — what a surprise.
- In Florida, Gov. Charlie Crist and other state officials continue to be in shock that they have not been able to alter human nature and economic self-interest with central planning. More than seven months after the state’s latest insurance fix, insurers continue to drop homeowners policies. The latest? Nationwide announced it is dropping 40,600 homeowners and business insurance policies next year. A year ago, Nationwide had 261,300 home policies, but it has only 176,000 now.
- Louisiana has finally fired the top official of the state’s high-risk auto pool, "after auditors told the agency’s board that an audit will show he may have been involved in questionable spending practices." He was earlier removed from the top spot for the state-run property insurer after auditors found that the entity’s books had not been balanced for two years and had a computer program that could not retrieve information the auditors wanted.
- Did you see this story, the one about the insurance company that hired detectives who joined a church and tape recorded support group sessions in an effort to uncover possible fraudulent claims by a couple who attended the church? You know, this is going too far, as the head of the company acknowledges, but how come the story doesn’t mention what led the insurer to suspect fraud in the first place? It’s legit to hire detectives to investigate fraud, as long as it is done by means that don’t violate social values: it’s OK to videotape someone who is supposedly injured working out at a public gym, it’s not OK to plant secret microphones in the baseball cap of the guy’s son to catch secret conversations in their home.
- You remember that Bloomberg story a few weeks ago, the one about insurers ripping people off, committing fraud just for fun and stealing old ladies’ purses, as their evil laughter echoes through the land while their plans to rob the world blind go off with nary a hitch? At that time, I wrote that I didn’t care for the story: for one thing, the lead anecdote was poorly chosen as an example of insurer rip offs, when in fact it appeared to be a case of someone who got caught short on their coverage and never read their policy. As human beings, we can all surely sympathize with this homeowner, because I’m sure we’ve all made our fair share of mistakes too, but I don’t confuse my sympathy with analysis of insurance contracts. As you may know, I used to be a newspaper reporter, have many friends that are journalists and respect and like journalists, so my bias is to avoid finding fault unless I can’t help it. But in this case I can’t help it. I thought the story was deficient and that it got carried away with a premise that was assumed rather than proven. The Bloomberg story used evidence very selectively and contained gaps in both knowledge of the subject and logic. I recently saw a Sam Friedman piece in National Underwriter that made me think of this again: Sam calls out insurers for sitting back and taking it when it comes to stories like this, a point I made yesterday when talking about Katrina issues.
However, I see that State Farm has on its website a pretty good "Fisking" of the Bloomberg story — this is the kind of thing insurers should do more of, and if they don’t get anywhere with traditional media, the internet not only allows them to tell their own story, but contains numerous new media that may be more receptive. Here’s my favorite part of the State Farm piece, because it talks about those e-mails from the McIntosh v. State Farm Katrina case that have been endlessly hyped as definitive proof of fraud, when to an observant reader all they show is a guy who is completely clueless and who is hardly an authoritative source:
Further, as evidence that there was wrong-doing, the reporters cite an e-mail from a Mr. Down at Forensics Engineering questioning motivations. What the reporters fail to provide is the under oath deposition of Mr. Down where he denies there was any problem and says that his e-mail inquiry was taken out of context. Robert Kochan, President of Forensics Engineering, additionally has made this clear. We further gave your reporters copies of AP news articles that confirm Mr. Down did not even work Katrina claims and had written the so-called incriminating emails based on rumor. So why didn’t Bloomberg include this information or an excerpt from sworn deposition?
I know that to some saying anything that is remotely favorable to insurers, or suggesting how insurers might better communicate with the public, is equivalent to defending the New York Yankees to the Washington Senators. But to me, discussing insurance coverage is not about good guys vs. bad guys. Precepts of logic, reason and fairness have to apply across the board — and these standards apply even when discussing those one may not agree with or like.