Insurance Industry Tactics
In 2016 there were roughly two hundred twenty-two million licensed drivers in the United States. The average auto premium in 2017 was $1,318. More and more the auto insurance companies are becoming aggressive in their attempts to capture a bigger piece of the mega billion dollar pie. Every other commercial on television is an insurer telling you that their insurance is cheaper than the company that was on five minutes earlier telling you the same thing. The marketing of these companies is by a strategy called "name recognition" (helped along with a jingle and celebrities and slogans). Very little is said about the product since research makes clear people will go with a company that they remember, almost subconsciously. Interestingly, the same tactics have been employed by law firms with repetitive name recognition strategies. The same profit motive behind the huge marketing expense is in play in the claims departments. In order to reduce amounts paid on claims adjusters will use a variety of tools.
Often times the goal is to minimize the extent and impact of injuries. A sampling of the arguments they are trained to use include:
1. The injury is only a soft tissue injury and symptoms can only last a short time.
2. Symptoms are caused by a pre-existing degenerative condition, not their insured’s negligence. (Even though on most occasions the pre-existing condition is asymptomatic signs of normal aging.)
3. Force of trauma not great enough to cause serious injury.
4. Medical bills were mostly diagnostic, not treatment related.
5. Comparative fault reduces value of claim. One adjuster reportedly advised an injured claimant that at least twenty-five percent comparative fault is assessed automatically under Iowa law. (The claimant was rear ended at a stop light).
6. The claimant over-treated, the medical charges are unreasonable, gaps in treatment indicate intervening cause, etc., etc.
Insurance companies profit under a simple formula. Premiums plus investment income minus incurred loss (claims paid) and underwriting expense (overhead) equals profit. The claims process is integral to the companies’ bottom line. The more money it keeps and the longer it keeps it (float) the higher investment return and the more profit. An experienced and motivated personal injury lawyer can properly guide your claim through the process and rebut the attempts made to unfairly minimize the real effect of injuries on the lives of real people.