Interesting to me how I have tried to maintain a formal approach to blogging and I am not having any fun. So, a change in venue is in order. Vern Harnish, the Rockefeller Habit and personal growth guru, has a great email presentation: snippets of information with links to what strikes him as pertinent each week. It is enjoyable to read, inspirational and a great source of business and personal growth material. So here goes.
I remain bothered by the claims practices of most insurance companies. I wonder if these organizations are so bureaucratic that they simply do not know what is happening at the point of settling claims with their customers. That's my nice side. My nasty side feels that the insurance companies conspire to pay less than the standard value of a claim. As a result, an insurance claim is a miserable experience for most of us and we end up rolling over and settling for $.55 on every $1.00 we pay in premiums; used to be $.70 for every $1.00 we pay in premiums. No wonder the insurance companies are now in their forth consecutive year of "unjustified profits, padded reserves and excessive capitalization" claims the Consumer Federation of America (Download 2008_INSURANCE_RELEASE_FINAL.pdf ).
A recent article in the Sacramento Bee discusses the largest fines ever levied against an HMO (http://www.sacbee.com/103/story/672192.html). What I found interesting about the story was the connection between the medical providers who wait extraordinary long periods for structured payments and our experience with the vendor programs provided by third parties for the insurance companies. It is the same model and it is the reason that one should avoid "guaranteed" vendor programs for providing services. They are paid less than market value for their services and wait long periods of time to be paid, all justified by the absurd bureaucracy managed by an independent third party.
Cleverly, the insurance companies now require all vendors to carry Pollution or Environmental Liability Insurance with minimum deductibles of $5000.00. This coverage is required because most insurance companies now exclude mold and other biological contaminants from their policies. Some even exclude water damage and their is a national data base maintained in Atlanta called CLUE that records every insurance loss you report (even if you do not make a claim! - see http://www.privacyrights.org/fs/fs26-CLUE.htm for more information). A true story: a major carrier failed to report a water damage for four days, then sent it to a third party vendor who in turn assigned it to an "approved" vendor who attended to the loss. The vendor attend to the damage according to the standard of care in the industry, ANSI, IICRC S500, Third Addition (http://www.cleancareseminars.com/iicrc_standard_reference_guide_s500.htm), The insured learned about the mold-is-gold phenomena and sued all three for the delay. The administrative law judge found the insurance company at fault but the pollution liability insurance company agreed to pay for some of the attorney's defense cost. Net result: the third-party walked away from the suit unscathed; the carrier bore the brunt of the claim and the vendor, who did nothing wrong, paid a $5000.00 deductible for defense of his position. Does anyone besides me see a transfer of liability to the little guy who did nothing wrong to defray the expense of the guilty party.
Please let me know what you think of the new format and I will get shorter in my delivery with practice, promise.
