Delay Deny Defend

An aspect of living in New Jersey that has improved over the years is the library system with new Sunday hours at many branches and being able to borrow from scores of libraries with a Kenilworth card. It was at the Matawan library which had a copy of a movie I was searching for where, browsing through the stacks, I stumbled upon a book related to a past life I had in the property & casualty insurance field. Excerpts follow:

Companies spend a great deal of money on advertising that they will fulfill their promise to provide security for their policyholders, but they also spend a great deal of money on lawyers to mask the times when that security fails. (page 8)

There is a simple if cynical explanation why solvency regulation and rate regulation work well and claims practices regulation doesn’t. Claims practices is the area in which the interests of insurance companies and the interests of consumers diverge most widely, and insurance companies have more clout with regulators. Cynicism is not an attractive character trait, and simple explanations are always partly wrong, but they are also partly correct, and being cynical and simple captures the essential truth about insurance regulation: The industry plays as big a role as do the regulators. (page 210)

Listing the good regulators (page 211):

While the state tries to govern the insurance industry, the industry’s trade groups “govern the government.” The groups’ activities are both proactive and preventive, getting what the industry wants and forestalling regulation that it doesn’t want, by continuously monitoring regulators’ activities, maintaining close associations with regulators, lobbying, providing research, and promoting the industry’s views to the public. (page 212)

Insurance fraud is a crime in every state, but insurance companies have persuaded regulators and the public that the only real insurance fraud is that perpetrated against them. Insurance fraud perpetrated by insurance companies should also be prosecuted and the companies punished appropriately. (page 219)

 

12 responses to this post.

  1. Posted by Mike on November 24, 2017 at 8:53 am

    Insurance fraud is a crime in every state, but insurance companies have persuaded regulators and the public that the only real insurance fraud is that perpetrated against them. Insurance fraud perpetrated by insurance companies should also be prosecuted and the companies punished appropriately. (page 219)

    That is a great quote and a good thought, with application to many forms of insurance.

    Reply

  2. Posted by Tough Love on November 24, 2017 at 9:03 am

    What’s interesting is that most fraud AGAINST the insurance company is a “criminal” offense, but in most cases, unsavory actions BY the insurance company …. say in refusing or delaying or paying less than what the contract calls for …….. are treated as contract disputes.

    Reply

  3. Posted by S Moderation on November 24, 2017 at 12:14 pm

    Perhaps there is someone more greedy than public sector unions. Insurance companies are a cancer upon society. Also big Pharma, big Oil, Wall Street, Main Stream Media, and the Catholic Church. Because…

    Reply

  4. Posted by Anonymous on November 25, 2017 at 7:10 pm

    Bless me father for I have under appropriated it has been decades since I’ve made my required contributions…..my special interests are too many to mention!

    Reply

  5. Posted by Tough Love on November 25, 2017 at 8:55 pm

    Blessed be NJ’s governors, because while they unfortunately “promised” pensions (AND benefits) 3 to 4 time MORE than necessary just, fair to Taxpayers or affordable ……………….. SO FAR, NJ’s taxpayers have only actually had to PAY-FOR a pension not TOO MUCH greater than what THEY typically get ….. and since the remaining 2/3 of their PAST service Public Sector pension accruals are BOTH not funded and not justifiable, we (the Taxpayers) are right on target for paying for the ONLY that share (about 1/3 of those ludicrously excessive promises) that we (the Taxpayers) should rightfully pay for.

    Reply

  6. Posted by Mathew 7:7 on November 26, 2017 at 12:43 am

    Ask, and it shall be given you; seek, and ye
    shall find; knock, and it shall be opened unto you:

    Reply

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