Each year insurance companies report earnings in the billions. Unfortunately, much of this profit is derived from the various tricks and tactics used by their employees on the insurance company’s behalf to minimize the full compensation you might be entitled to. These multibillion-dollar profits are not the result of insurers eagerly, fairly and promptly settling claims but rather avoiding liability, minimizing their own exposure and making low-ball settlement offers. Below is a list of strategies/traps the insurance companies use to shortchange the injured and rack in record profits.
10 PITFALLS TO AVOID WHEN DEALING WITH INSURANCE COMPANIES
1. THE RECORDED STATEMENT
Insurances companies employ urgency during the early phases of your claim because that’s when they want to pin you down, even if it requires being taken out of context. For example, the insurance adjuster begins a recorded statement with “Good afternoon! How are you today?” Unwittingly, you politely respond by saying “I’m fine, how are you?” What’s just happened? You have now just admitted to being “fine” and the insurance carrier will use this “admission”, even though it is being taken out of context, against you at settlement time. How seriously could you have been injured when you were “fine” during the early phases of your claim when you gave a recorded statement?
2. HIDDEN CLAUSES
Suppose the insurance adjuster wants access to your medical records and graciously offers to save you time and energy and agrees to collect the records on your behalf. In order for the adjuster to collect these records, he or she will need a signed medical authorization from you. This is often a cumbersome form with a lot of fine print. The insurance adjuster may try to sneak hidden language into this form that allows them to collect records that predate your accident in an attempt to find some prior medical history to pin your current symptoms on in order to avoid responsibility for the injuries you suffered in the current accident.
3. YOU HAVE FAULT TOO
Arizona uses a pure comparative fault tort system to determine the fair apportionment of fault. The insurance company uses this system to minimize the fault of its insureds and maximize the fault attributable to you. This tactic allows the adjuster to equally reduce the amount it ultimately pays you for compensation of your damages. This system is designed for a jury to decide, not the adjuster. Because most cases are resolved long before ever reaching a jury, comparative fault is subjective and requires rigorous argument by an experienced lawyer to maximize your recovery when you may have slight responsibility that the adjuster seeks to magnify.
4. SPYING ON YOU
Lately, insurance companies have been spending a tremendous amount of time and money perfecting the use of social media as a means of gathering information about you in an effort to minimize your injuries. For example, the adjuster may search your public social media account and find a picture of you wearing a backpack and attending a sporting event. The insurance company will use this photo at settlement time to say you couldn’t be that injured because sporting events involve long hours of standing and the backpack may have been heavily weighted. Perhaps the backpack is your friend’s and you only wore it for the photo and your seats were in the club level where you sat the entire event. Nonetheless, this photo will be used as “evidence” that you were not truly injured or that your injury wasn’t “that bad.”
5. DELAY, DELAY, AND DELAY
Insurance companies delay the resolution of your case for two primary reasons. The first is that delay often leads to frustration, which may cause you to settle for a low-ball offer because you’ve given up. The second is that the statute of limitation, which requires that you resolve your claim within a certain period of time or forfeit recovery, may expire and the insurance company doesn’t have to pay you at all, even when compensation is owed to you.
6. INSIDER INFORMATION
Have you seen the movie “Moneyball”? In the movie, the main character uses “analytics” or “predictive modeling” to outsmart other baseball teams with bigger budgets. Insurance companies have been using these tactics for years. For example, by digging up information about your lawyer and maintaining a database, they try to predict how often your lawyer settles for a smaller settlement or fights for full compensation. This is why experience matters when selecting a personal injury attorney.
7. SUB ROSA
This is a Latin term meaning secrecy, privately, and confidentially. Insurance companies pay private investigators a lot of money to follow you around and secretly film you, often doing everyday tasks. Suppose you are suffering from a back injury following an auto accident. The adjuster will hire a private investigator to secretly follow and film you often only capturing you going to the mailbox or the grocery store. However, the adjuster will use this mundane footage as “evidence” that you can bend, twist, and push a shopping cart all in an effort to minimize your injury or suggest you aren’t injured at all.
8. THE FRIENDLY ADJUSTER
Remember, the adjuster is working for the insurance company to ensure billion dollar profits, this person is not your friend but rather your adversary. The adjuster’s compensation, job security, and advancement are dependent on saving the insurance company money and paying you as little as possible. Don’t be fooled by the polite, cordial, and friendly adjuster, no matter how sincere the “I have your back” or “I promise to get you a fair settlement” comment seems, the adjuster is always the antagonist.
9. QUICK SETTLEMENT
Don’t be fooled by the quick cash offered by the adjuster. Often time’s injuries are not fully known or fully developed during the early phases of the claim process. The insurance adjuster may try to entice you with an early settlement. This settlement will come with a full release requiring your signature. If you accept this quick settlement and later discover your injuries are more sever than anticipated, you will be barred from additional recovery and stuck paying for those injuries from your own pocket.
10. YOU DON’T NEED A LAWYER
Keep in mind, the adjuster handling your claim exists to protect the insurance company from having to pay your claim. It’s easy to see why they don’t want a lawyer involved – the personal injury attorney exists to protect you from these behaviors and hold the insurance companies accountable for the full amount of compensation you deserve.
Attorney Robert Poundstone of POUNDSTONE SCOTTEN, PLLC spent nearly two decades working for several large insurance carriers. Much of his time working in the insurance industry was spent as a claims adjuster so he is very familiar with all the tricks and tactics that are used against you. His experience and “inside baseball” knowledge is the envy of other personal injury attorneys. If you’ve been injured, don’t let insurance adjusters shortchange you. Call POUNDSTONE SCOTTEN, PLLC for a free consultation today.
The information provided in this website is meant only as a general description of the current laws as of the date of the writing. It is not meant to be an exhaustive discussion of all the nuances of the law and is intended to be only an overview. Many issues may appear simpler than they are, and an individual should always contact an attorney to obtain a complete, accurate interpretation of the law given the individual’s particular circumstances. POUNDSTONE SCOTTEN, PLLC makes no representations as to how the law would affect a particular situation and intends only to illustrate areas of concern and give general information.