Joined: 04 Jan 2004
Location: Montgomery, PA
|Posted: Sun Dec 05, 2004 11:57 pm Post subject: Point/Counterpoint
|This dialogue was extracted from an actual forum conversation:
Disasters (hurricane, tornado, fire, flood, earthquake, etc.) and what disaster survivors face after the dust settles:
the power to determine
...When buying and selling property it is clear who is the buyer and seller. A seller would never relinquish authority over to the buyer. Just imagine, you let the buyer take over your say to determine what you get paid and set the terms of the sale. That would seem downright daft, even to a child. Yet it is now our lot and needs serious questioning. A claim is the right to say, "This is mine and this is what I'm entitled to because of this, that and the other." It is the basic, intrinsic right and authority that we have, be it in the sale of property or in presenting what is owed on that property, unless and until we negotiate and settle...
Full article in the book, "Policy Ensurance"
You do bring up a good point.
I don't think it matters really though. Your "loss" still has a claim number attached. People in the insurance industry refer to losses as "claims." I would actually argue a LOSS is more advatageous for the homeowner. A loss is based on fact, a claim is based on faith. So when filing a loss, there's a connotative idea of truth that comes with the word "loss."
We have a difference of opinion. Filing a claim is a formal demand for payment and has time limits and repercussions for payment, or submission to a higher authority to resolve. A claim is an opinion that is true, but so is reporting the amout of a loss, and so is the response to that claim or loss. Under the new wording there is no such leverage as that of a claim and it is no longer yours to say what you are entitled to but in the hands of the other side. As devastating as that can be, especially to disaster survivors, that to me is minor compared to losing your right of authority. If that makes no difference to you, then you and I do not share the same ideals. Lose your authority and you may as well kiss it all good-bye. Corporate domination is not merely innocuous control. The guest has taken charge of the host and rolling over your authority is not my idea of how to resist--to arm yourself with information is.
About your comment that the industry refers to losses as claims: the company has only authority to determine its liability. It has no authority to calculate, prepare and file claims for policyholders. That may seem severe because it is so contrary to industry practices. However, it is fact under the law. That is why adjusters are licensed to represent the company or the policyholder, not both. They are two separate worlds: 1. liability 2. claim. Just as a defense attorney would never help a plaintiff prepare and file a claim that the defense attorney defended because of clear conflict of interest, the insurance industry needs to reform and mind its own business, if only to avoid finding itself on the wrong end of a class action. They'd best not dally, they've made themselves a very large target and attorney generals, among others, are taking aim at this moment.
There are a great number of situations when a policyholder needs the right to file a formal claim that does not agree with the insurance company, some of them are found on this forum and the two forums I host. However, I'm going to list one prime example. You can only imagine the impact that it has on someone who has just lost everything in a disaster. No difference? I beg to differ.
Common Problem For Disaster Survivors--Who cares...let them fend for themselves?
When a building is ordered demolished that has been involved in a disaster, it is unconscionable that disaster survivors are paid for partial loss when they have lost everything and are entitled to total loss. And, merely because no one told them what they really had coming and how to get it.
This applies in this day and age, to property in every community where fire, hurricane, earthquake, tornado, flood or other disaster happen, and should be of concern to all insurance policyholders. I hope you will agree when you see how the public is affected.
The building dept. in my town is pressuring me to tear down what remains of my fire-damaged home but I don't want to yet. I'm still dealing with my insurance company. Has anyone else had a similar problem?
When a building is ordered demolished by a building inspector because of a fire or other insured peril, the insurance company is liable for the whole loss and cannot say part of the loss is excluded because it was caused by enforcement of a city ordinance:
Full article in the book, "Policy Ensurance."
This is one example of a great many where it is essential for policyholders to have authority to file a "claim" for an amount of loss that does not agree with the insurance company. Although we have lost that right, the word "claim" has been removed from many of our insurance policies: http://www.disasterprepared.net/postmortem.html ... our presence can still be made known. And there is VAST hope. The power of people sharing a realization...the making of a presence known. The public has nowhere to turn for this otherwise unavailable information, except from those who care enough to share.
Who Cares? Hopefully, you do!
Again, you bring up a good point - this time on fire policies, and I may seem really cold-hearted on this one... but why would ANYONE get a fire policy, just get a deluxe policy and you're set. Part of marketing is making available different types of products tailored to what a consumer wants to spend. Simple as anything to not buy a fire policy - if a fire policy was as good as a deluxe policy for the same price, nobody would buy a deluxe policy - this blame falls on ignorant consumers.
I will not argue that insurance in general needs a major overhaul on the way claims are dealt with, but I don't have much sympathy for someone who wants to pay 25 bucks less a year and then cry about it when they have to shell out a lot of money. Cutting corners in life gets you nowhere, so while I agree that policies should guarantee replacement cost of items with regard to building code improvements and such, I really don't have much sympathy.
You say the company has no authority to calculate, prepare, and file claims. Wrong, wrong, true - which is supported by wording in each policy. If people just name a price on what they lost, then insurance premiums would be so astronomical in today's society, that nobody would be able to afford insurance. Again, simply look at your newspaper about FEMA claims.
And further, insureds CAN name a price for what they lost. That's in the policy as well under appraisals and mediation. If one does not agree with the settlement, they can choose to go to appraisal, and then typically mediation.
I think you have way too much faith in your common man and much too little faith in business.
This is about changing a system that is much in need of reform and not really a threat to that system, no more than the likes of H & R block or taxpayers themselves are a threat to the US tax system. In keeping with how insurance was set up in the first place, it merely gives back authority to the policyholder for presenting the claim and changes who handles preparation, subject to review, audit, negotiation and adjustment. The companies need no more than the authority they have had for centuries under property insurance, i.e., receive and consider the claim prepared and filed by the policyholder. Also, replacement cost coverage contains hidden flaws and traps for the policyholder, and not nearly as simple as leaving it in the hands of the opposition without jeopardy. Please see: Building under replacement cost http://disasterprepared.net/forumreplacement.html
What I said applies to property policies--commercial and residential. There is a litany of recent wording and rules changes now in the companies' favor--too many to list here, but I do have most of them listed with word for word comparison in my book. By the way, many company adjusters do not know there are rules at all. Most states have unfair claims practices acts, but not widely known. It is these obscure rules that set the standard for fair claims practices, together with property policy wording changes, that have undergone the greatest change in favor of the companies.
The veil only cloaks reality. One of these days it will be removed for good and vital claim filing information, policyholder rights, adjusting basics, forms and procedures made accessible as your tax filing rights, rules, deductions, forms and information that we take for granted. It will happen--maybe not in my time, though I have no doubt the future holds it a necessity to accompany every insurance policy. I place my faith in mutual enlightenment of both company and policyholder, not myth.
Thank you. I've enjoyed the discourse.
Here is a point of reference based on fact...
How to Know what to expect in case of loss: