"The McKinsey-designed insurance strategy was major news through the 2000s. This was thanks to numerous lawsuits by both private attorneys and state officials like Foti, who went to war with Allstate and State Farm on behalf of consumers railroaded by the companies after not just auto collisions and fires, but natural disasters like tornadoes and hurricanes.
A New Mexico Judge has found Allstate Insurance Company guilty of malicious abuse of process. The finding was in, Martinez et. al. v. Allstate Insurance Company, No. D-0101-CV-200400963 filed in the First Judicial District Court (County of Santa Fe) in New Mexico. During the bench ruling The Honorable Barbara J. Vigil stated:
If you are a lawyer interested in bringing abuse of process claims against Allstate or other insurers for the intentional denial, delay or requirement to litigate claims, read From Good Hands to Boxing Gloves. The book gives you an outline of how insurers profit by improperly forcing claimants to file litigation to get fair compensation.
Now get the background about why settlement offers are down. Why insurers spend more to defend claims than to resolve them, and drag litigation out as long as possible. It's time that every lawyer understand the "Deny-Defend-Delay" strategy being used by insurers.
The American Association for Justice (AAJ) has named the Top 10 Worst Insurance Companies in America. In doing so, it cites Trial Guides' book From Good Hands to Boxing Gloves and articles arising from publicity around that book as the basis for naming Allstate the #1 worst insurer in America.
The 29 page report has a section for each of the ten worst insurers. The section on Allstate notes at footnote 11 "There is no better analysis of [Allstate's] McKinsey documents than the book, 'From Good Hands’ to Boxing Gloves,' by David Berardinelli, Michael Freeman, and Aaron DeShaw. Many of AAJ's citations to articles about Allstate's institutional "Deny, Delay, Defend" policy cite the book as the authoritative source on Allstate's policies and procedures as well as the way they have impacted the rest of the insurance industry. These include the feature articles by BusinessWeek, Money magazine, CNN and others.
This week, Florida Insurance Commissioner Kevin McCarty announced that he is suspending Allstate Insurance companies from writing new insurance in Florida. McCarty's choice follows Allstate's refusal to comply with subpoenas served October 16 by the Office of Insurance Regulation.
The subpoenas seek disclosure of the McKinsey Documents, in which McKinsey & Co. instructed Allstate how to systematically underpay claims starting in the mid 1990s. The content of the documents is so explosive that Allstate has already ignored a $25,000 per day fine in Missouri for its ongoing failure to provide the McKinsey Documents in that state.
"An epidemiologist testified Tuesday that assumptions in an Allstate claims handling manual about how much force passengers endure in low-speed wrecks have no scientific basis.
“These numbers are impossible, and they are just made up,” said Michael Freeman, an epidemiologist at Oregon Health and Science University testifying in the second day of a $1.425 billion civil trial in Fayette Circuit Court challenging Allstate Insurance Co.’s claims handling practices."
The following article is published in Bloomberg Markets [Since removed from the internet] It provides one of the most comprehensive public media stories covering the serious problems in the insurance industry in America caused by programs of defense, delay and denial of claims.
The Insurance Hoax
By David Dietz and Darrell Preston
Julie Tunnell remembers standing in her debris-strewn driveway when the tall man in blue jeans approached. Her northern San Diego tudor-style home had been incinerated a week earlier in the largest wildfire in California history. The blaze in October and November 2003 swept across an area 19 times the size of Manhattan, destroying 2,232 homes and killing 15 people. Now came another blow.
The following is a post by PBS regarding its investigation into insurance claim denials and underpayments in the United States [since removed from the internet]. The story cites Trial Guides' book From Good Hands to Boxing Gloves. It is accompanied by a video "Home Insurance 9-1-1" [which has also since been removed from the internet]:
In the fall of 2003, one of the largest recorded wildfires in California's history destroyed over 2,200 houses and killed fifteen people. Soon after, many who'd lost their homes had a rude awakening: their insurance did not nearly cover their losses as expected.
CNN has released a new expose on the insurance claims handling by State Farm and Allstate, titled "Auto Insurers Play Hardball in Minor-Crash Claims. The article covers the topic in Trial Guides' book From Good Hands to Boxing Gloves.
The beginning of the article notes:
"If you are injured in a minor car crash, chances are good that you will be in the fight of your life to get the insurance company to pay all the medical costs you incur -- even if the accident was no fault of your own.
Below is a Transcript of CNN’s Expose on Allstate and State Farm [since removed from CNN and all web video services.] Wed., Feb. 7, 2007
Insurance companies fight paying billions in claims
"ANDERSON COOPER: Traffic accidents, of course, are a fact of life. So is dealing with insurance companies. You pay them to protect you. That’s the idea. But some accident victims say they’re being forced to settle or go to court because
the claims are denied.
We wanted to know the facts, and in a CNN investigation, we looked into
whether some big name insurers are more interested in profit than
Eugene Anderson is a pioneer in the field of insurance law, and and is an icon in the field of insurance law. He is the founding member of Anderson Kill, arguably the leading insurance coverage law firm in the United States. Gene has written several legal treatises and legal journal articles on insurance, including Insurance Coverage Litigation, the ABA Manual for Complex Insurance Coverage Litigation, and more. Some even say that Anderson's career fighting insurers was the inspiration for John Grisham’s The Rainmaker.
So, we are pleased to announce that Mr. Anderson has agreed to write the introduction to Trial Guides' upcoming book “From Good Hands to Boxing Gloves.”
Here is his introduction:
A new article by BusinessWeek titled "In Tough Hands at Allstate"
The article notes that From Good Hands to Boxing Gloves "tells the story of the key role played by management consultant McKinsey & Co. in reengineering auto insurance claims operations at Allstate Corp. (ALL ) -- and it's a story Allstate doesn't want told."
Trial Guides authors David Berardinelli and Aaron DeShaw are being interviewed by Turner Network for CNN and Money Magazine regarding Allstate Insurance's claim handling method called Claims Core Process Redesign ("CCPR").
"Allstate Insurance Co. is engaging in a systematic and fraudulent scheme to make obtaining fair offers for damage claims so difficult that victims accept low offers rather than pursue costly and time-consuming litigation, attorneys for a Richmond woman argued yesterday in Fayette Circuit Court..."