Re: State Farm whistle-blowing agents

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: They should investigate TN. esp. benton county agency and Eric Staniak in Murfreesboro Tn the big cheese. They are questionable in my opinion.: FORMER STATE FARM AGENTS: STATE FARM TERMINATES WHISTLE-BLOWING AGENTS; DC PRESS : : CONFERENCE ON CONSUMER ABUSE SPURS AGENT FIRINGS : : AUSTIN, Texas, Dec. 9 /PRNewswire/ -- The following was issued today by Larry Wilson, former State : : Farm agent: State Farm Mutual Insurance Co. terminated its contracts with four insurance agents today for : : publicly discussing a company-wide pattern of consumer abuse at America's largest insurance company. : : Additional terminations are expected today. : : These whistle-blower like terminations came on the same day a group of active and former agents : : delivered a letter to insurance commissioners across the country informing them of State Farm's : : violations of state insurance regulations, discriminatory policyholder selection criteria, and attempts to : : fight the release of zip code data commonly used to determine redlining (see letter below). : : A group of active and former State Farm agents earlier presented a letter to the United States Senate : : Commerce Committee discussing State Farm's fraudulent use of medical utilization review companies : : designed to lower payments to victims in auto accidents, fraudulent use of after-market auto parts, history : : of misrepresenting life insurance policies as investment vehicles, overcharging on homeowner's : : insurance and de facto redlining. A press conference took place in Washington DC on October 29, 1999 : : where terminated agents Mike Morgan, along with others, made presentations. The letter to the : : Commerce Committee was made public at the press conference, which was signed by the other three : : terminated agents. : : Termination is the standard practice anytime an agent or employee questions deceptive or : : anti-competitive behavior at State Farm," agent spokesman Patrick Woodson said. "The only people who : : have breached any duty are the thugs at State Farm management. It is clear they will stop at nothing to : : quiet any principled agents. : : "Millions of Americans are being abused by State Farm and these agents were trying to make this : : company do the right thing," Woodson said. "These agents have gone to court to stop these practices. : : Now, they have gone public to stop continuing policyholder abuses. State Farm management should be : : held personally accountable for their actions today and for years of disservice they've done State Farm's : : policyholders." : : State Farm cited the agents' participation in the 10/29/99 press conference as the reason for the : : termination proceedings. Agents terminated were: -- Michael Morgan of Dayton, OH. (937) 434-6673; -- : : Lee Saghirian of Millersville, MD. (410)266-7920; -- Clifford Lykke of Houston, TX. (281) 444-1520; -- Alan : : Perkins of Tacoma, WA. (253) 537-1444; : : December 9, 1999 : : Larry Wilson : : 2402 North Shields Drive : : Austin, TX 78727 : : Director Nathaniel S. Shapo : : Illinois Department of Insurance : : 320 West Washington St., 4th Floor : : Springfield, IL 62767-0001 : : RE: State Farm Insurance Co. Pattern of Insurance Abuse : : Dear Director Shapo: : : We are writing to call your attention to a national pattern of insurance abuse directed by the management : : of State Farm Insurance Companies towards its sixty million policyholders throughout the United States. : : The signators on this letter are current or former State Farm agents.Beginning in the early 1990's, State : : Farm made a fundamental shift in its management strategy, which has created a company-wide pattern of : : fraud and abuse. For our part, we have filed litigation in California to stop these abusive practices to : : protect both policyholder and agent. : : State Farm knowingly engaged in policies ending coverage, creating de facto discrimination, employing : : fraudulent medical utilization review companies and creating other practices to reduce risk and : : simultaneously enhance profits. These policies violate a number of state insurance regulations and may : : well run afoul of your state's regulations. : : First, we have direct evidence of a corporate practice called "managed growth" or "exposure : : management," which forces State Farm agents to engage in discriminatory declinations unrelated to : : underwriting criteria. These programs force their agents to become discriminatory weapons to control : : profitability in a number of states. : : Second, we can show how State Farm put an insurance to value mechanism in place to extract additional : : premiums from property and casualty policyholders without increasing the commensurate risk to the : : company. : : Third, we have direct knowledge of how State Farm institutes policies directly opposed to the public's : : interest, including the acceptance and declining of policies through "desirability profiles," unfairly declining : : coverage by tying quotas to individual agent profitability, and creating an unrelenting pressure on its agent : : force to sell life insurance. : : Since State Farm's management shift, this company has amassed record profits. In its first seventy years : : of operation (1922-1992) State Farm built an $18 billion surplus. Since 1992, which has included : : Hurricane Andrew in Florida and the Northridge earthquake in California, the surplus has increased to : : more than $60 billion. In the last seven years of operation, company coffers have more than tripled, while : : many consumers have seen eroding coverage and/or higher insurance rates. There is no doubt the : : consumer is being unfairly harmed by State Farm's policies. : : Property and casualty policies in California and Florida are good examples of this trend. In those states, : : State run insurance programs assumed much of the risk after Hurricane Andrew in 1992 and the : : Northridge earthquake in 1994. Despite the fact that company officials had access to an $18 billion : : surplus which California and Florida policyholders helped create, State Farm threatened to quit writing : : new property and casualty policies in those states until government-sponsored entities like the California : : Earthquake authority (CEA) and the Florida Residential Property Casualty Joint Underwriting Association : : (JUA) were set up to assume all or most of the market risk. What resulted for consumers who continued : : with State Farm were considerably higher rates and worsened coverage. Even today, State Farm offers no : : earthquake coverage to California property and casualty policyholders. It is another example of how this : : company has built higher profits on the backs of the policyholders. : : The visible symptoms of the company's practices are just beginning to become apparent. Years of abuse : : have put a handful of State Farm's practices under the legal microscope. In courts in 1999, State Farm : : settled or was forced to pay more than $1.5 billion. A jury found State Farm committed fraud in their use of : : after market car-parts and a judge in Oregon wrote that State Farm engaged in a fraudulent scheme to : : limit payments to auto accident victims through its use of phony medical utilization review companies. : : Another alarming trend is the caustic struggle over trade secrets. State Farm is fighting attempts in Texas : : and California to release coverage data by zip code. As you are aware, that data can be mined to : : determine if State Farm actively engages in redlining particular areas. : : The company uses similar "trade secret" arguments in its intimidation attempts to keep its principled : : agents from even speaking to former customers once they have left State Farm. There is an on-going : : case in San Francisco where State Farm is suing two agents the company terminated for disagreeing : : with State Farm policies and tactics. The suit alleges these two individuals are engaging in "unfair : : competition" under the guise of "trade secrets" of the company when in fact the agents are simply : : maintaining a visible presence in the marketplace and offering former policyholders an alternative. : : Ferreting out these problems is difficult because State Farm has instituted a policy of intimidating and : : threatening whistle blowers. Members of our group have been threatened with termination for speaking : : out against the company and highlighting their unethical practices. : : We are writing to you in the hope that you will look deeply at State Farm's practices and make an : : independent verification that policyholders in your state are not being harmed by these abuses. We would : : welcome the opportunity to share our knowledge with you and are available any time to discuss these : : matters. : : You contact any of us through Patrick Woodson at (512) 474-7514 or through our website at : : http://www.SFAGENTSWHOCARE.org. : : Sincerely, : : Larry Wilson : : For: Art Appling, Santa Rosa, CA. Paul Quilici, Reno, NV. : : Bill Bernard, Carmichael, CA Lee Saghirian, Millersville, MD : : Dan Brumfield, Fair Oaks, CA Jo Ann Searcy, Oxnard, CA : : Jacob Castroll, Studio City, CA Tana Schultz, California, MD. : : Lyle Chambers, Nampa, ID. Rosanne Smith, Pleasant Grove, UT. : : Bill Cornelison, Fresno, CA Anthony Vito, Tucson, AZ. : : Marilyn Cusimano, San Jose, CA Terry Walker, Sebastopol, CA : : Larry Daveggio, Santa Rosa, CA Verne Walton Agency, San Jose, CA : : Leonard Doctor, Northridge, CA John Wier, Crescent City, CA : : Dennis Farrell, Bermuda Dunes, CA Larry Wilson, Austin, TX : : Jerry Flanders, West Palm Beach, FL. : : Andy Gaines, Omaha, NE. : : Ray Gilmore, Livermore, CA : : Mike Hartman, West Palm Beach, FL. : : Paul Julian, Palm Desert, CA : : Joseph J. Kelly, Joplin, MO. : : Bob Kennedy, Apple Valley, CA : : Chuck Lewis, Littleton,CO. : : Fred Love, Granite Bay, CA : : Clifford Lykke, Houston, TX. : : Michael Morgan, Dayton, OH. : : Alan Perkins, Tacoma, WA : : Doug Perry, Auburn, CA : : Matt Pickett Jr., San Jose, CA : : Dale Pitney Jr., Scottsdale, AZ. : : Richard L. Pyorre, Ft. Bragg, CA

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