Insurance Bad Faith

Allstate’s Secret Documents Revealed in $1.4B Trial
Allstate Insurance Company was allegedly advised by the McKinsey Company to avoid paying policyholder's claims beginning in the mid 1990's. Those documents are now being used against them in court.

Insurance Companies May Be Sharing Your Personal Information
Insurance companies may be sharing, selling or purchasing information on your auto and homeowners' insurance to better calculate their risk. Approximately 40 million claim files are shared between insurance companies, but consumer activist groups say tha

Insurance Rescissions: A Damaging Practice
Insurance companies have the right to rescind policies when they discover that policyholders failed to disclose important information about themselves in the applications for insurance. When used correctly, the practice of rescinding policies protects in

WA State Passes Tough Bad Faith Insurance Referendum
Insurance companies who don't do what they're supposed to - pay claims promptly and treat policyholders fairly - act in bad faith. It's bad business and too many insurers seem to get away with it. Washington state residents recently did something about

Port of New Orleans Sues Insurer over Unpaid Katrina Claims
A lawsuit has been filed - this one by the Port of New Orleans against Factory Mutual Insurance for over $100 million in unpaid claims. The suit alleges that the insurer has acted in bad faith in its claim handling process.

Louisiana AG Sues Insurers for Bad Faith over Katrina Claims
Louisiana Attorney General, Charles Foti, is suing several insurance carriers for conspiring to deceive the victims of Hurricane Katrina by providing lower damage estimates, offering lower claim payments and forcing many homeowners to take them to court.

State Farm Loses First Federal Katrina Case
A Louisiana jury recently decided that homeowners who lost everything during Hurricane Katrina were entitled to insurance coverage from State Farm Insurance Company. It was the first federal trial in Louisiana against the insurer.

Allstate Must Reveal Secret Documents
Insurance industry giant, Allstate Insurance Company, has been trying to keep damaging documents behind closed doors for years. That door will be opened as a Kentucky judge recently ruled that the company must reveal secret documents showing that it hire

Teen Dies after CIGNA Refuses To Pay for Transplant
Insurance mega-giant, CIGNA Corporation, refused to pay for a liver transplant of a 17 year old girl after doctors, nurses and others pled with the company to provide coverage. The girl died in the process and now CIGNA faces a lawsuit by her parents.

Allstate Paying $25,000 a Day for Not Producing McKinsey Report
Allstate Insurance Company has defied a court order that forced them to produce what has become known as the McKinsey report. It's been three months since the order and Allstate still hasn't produced the documents - leaving them with an escalating fine t

California Insurers Will Pay $7.2M for Scamming Seniors
California's Attorney General, Gerry Brown, and Insurance Commissioner, Steve Poizner, announced a $7.2 million settlement between the state and American Investors Life Insurance Company, Family First Advanced Estate Planning and Family First Insurance Se

Consumer Legislation May Limit Mandatory Arbitration
Many consumers are subject to mandatory arbitration from the products and services they purchase - yet few realize it. Several bills have been introduced in Congress that would limit mandatory arbitration, which is generally not consumer friendly, and al

Suing HMOs for Denying Care: The Controversy Continues
Doctors who provide sub-standard care can be sued for medical malpractice. However, HMOs (health maintenance organizations) who tell the doctors what they can and cannot do are shielded from medical malpractice lawsuits. Many believe that this practice,

Texas Mutual Accused of Fraud
A Texas district court judge recently accused Texas Mutual Insurance Company of falsifying documents in a workplace injury case. The judge, seeking to teach the insurer a lesson, required Texas Mutual to post the notice on its web site.

$8M Punitive Damages Award against State Farm Upheld
A Missouri appellate court recently upheld a lower court ruling that imposed an $8 million punitive damages judgment against State Farm. The damages award, meant to punish State Farm for breach of contract and malicious prosecution, stems from a court ca

Allstate Suspended From Doing Business in Florida
Allstate Insurance Company has been suspended from doing future business in Florida until it complies with the state Insurance Commissioner's request for documents. The news of Allstate's bar has shocked the industry.

New Study Accuses Insurers of Overpricing and Underpaying
A new study released by the Consumer Federation of America (CFA), a non-profit advocacy, research, education and service association of 300 consumer groups with a membership of 50 million people, accuses the insurance industry as a whole of underpaying it

PacifiCare Faces $1.3 Billion in Penalties for Over 130,000 Violations
California Insurance Commissioner Steven Poizner and the Director of the California Department of Managed Care (DMHC), Cindy Ehnes, announced that they are seeking $1.3 billion for over 130,000 alleged claim violations made by PacifiCare. It is the first

California Coming Down On Insurers ‘Like A Ton Of Bricks’
California's Insurance Commissioner, Steven Poizner, in conjunction with California's legislature and Department of Managed Health Care's Cindy Ehnes, are getting serious about ending the insurance industry's bad faith practices. Poizner summed it up bes

United Health Care: Huge Fines & Scandals
United Health Care, Inc. (UHC) has seen better days. Insurance Commissioners from California and Texas have slapped the health care provider with huge fines and its former Chief Executive Officer was replaced in 2006 over a stock option scandal.

Florida’s Governor Believes Allstate Is Gouging Residents
In the continuing battle between the state of Florida and Allstate Insurance Company over the production of the secret McKinsey documents, Governor, Charlie Crist, was quoted in Florida's Sun Sentinel newspaper as saying that, in his opinion, Allstate is

Mississippi AG Moves Forward With New State Farm Investigation
Mississippi's Attorney General, Jim Hood, has said that he is moving forward with a new criminal investigation into State Farm's handling of Hurricane Katrina claims. Although Hood's office was to stop investigating State Farm for 'crimes against policyh

American Fidelity Ordered To Pay $10M in Punitive Damages
American Fidelity Assurance Company was hit with a $10.8 million punitive damages award for changing the way it pays out benefits. The jury verdict was clearly a sign to punish the insurer for acting in bad faith as the underlying dispute was only for ab

Allianz Life Agrees To $10M Settlement for Deceiving Seniors
The Allianz Life Insurance Company, California's largest seller of annuity products, has agreed to a $10 million settlement with California Insurance Commissioner Steve Poizner's office for allegedly targeting thousands of senior in deceptive annuity sale

NY Attorney General Accuses Nation’s Largest Insurers of Fraud
New York Attorney General, Andrew Cuomo, announced that his office is conducting an industry-wide investigation into fraudulent activity by some of the nation's largest insurers - including Aetna, Empire Blue Cross Blue Shield, CIGNA and UnitedHealth Grou

AIG & General Re Insurance Executives Found Guilty Of Fraud and Conspiracy
Five executives, one from American International Group, Inc. (AIG) and four from General Re Corporation (Gen Re), were found guilty of fraud and conspiracy and face prison sentences and hundreds of millions dollars in fines.

Allstate Releases 150,000 McKinsey Documents
Allstate Insurance Company has released 150,000 documents prepared in the 1990's by the McKinsey Company that have been a source of controversy for several years. The moves came after Florida banned the insurer from writing any new business in the state

Fireman’s Fund Hit With $5.3M Bad Faith Insurance Verdict
A Montana jury hit Fireman's Fund Insurance Company with a $5.3 million bad faith insurance verdict after the company refused to pay the claim of a woman who suffered severe braid injuries in an auto accident that wasn't her fault. It is the largest bad

Can Insurance Companies Fund and Administer Health & Disability Plans?
Is a conflict created when the same insurance company both administers and funds a benefit plan? That's the question that the U.S. Supreme Court will decide later this year - and it could have a significant impact on the insurance industry.

Insurer Unum Group Reverses 42% Of Previously Denied Disability Claims
A multi-state settlement agreement with the Unum Group will provide consumers in 48 states and the District of Columbia with over $676 million in additional disability benefits. The agreement reverses nearly 42 percent of previously denied disability cla

Central United Life Insurance Class Action: Policyholders Have Until June 3rd to Opt Out
Central United Life Insurance cancer policies only reimburse policyholders for actual charges for chemotherapy / radiation benefits. However, the insurer has been accused of only paying a fraction of those charges and many insureds may have only received

Insurer Balance Billing: A Practice That Leaves Policyholders in the Dark
It's no secret that the amount that doctors and hospitals charge is often very different than what insurance companies want to pay. Although policyholders shouldn't get caught in the middle of these situations, they often due and many feel completely in

Insurers Ordered To Pay $60M in Bad Faith Disability Claim
Paul Revere Life Insurance Company and its parent company Unum Provident were ordered to pay $60 million to a Las Vegas man for acting in bad faith when they denied his valid disability claim.

Texas Bad Faith Insurance Lawsuit Awards Restaurant $4.2M
A jury recently awarded a Corpus Christie Texas restaurant $4.2 million after its insurance company refused to cover a slip and fall claim because the accident involved an off-duty employee. Nearly two-thirds of that award constituted punitive damages against the insurer.

Big Insurance Companies Vs. You: Tipping The Scales In Your Favor
Big insurance companies have thousands of claims representatives, investigators and an army of attorneys to represent the company's best interests. You have - yourself. So, how can you tip the scales in your favor so that David can beat Goliath?

Insurance Company's Bad Faith Tactics: You Simply Won't Believe This One
The Great American Insurance Company, owned by American Financial Group, has refused to pay the claims of surviving family members of a Texas fire. It says that the smoke which killed four people was "pollution" and therefore, it isn't liable for damages. Critics are saying that the company's denials are bad faith at its absolute worst.

South Carolina Cancer Patients Awarded $7.8M For Bad Faith Insurance Practices
Over 180 South Carolina state employees may share in a $7.8 million verdict against two insurance companies accused of bad faith insurance practices after the companies cheated them out of payments by changing their definition of “actual charges.”

Senate Investigates Health Insurers’ Use Of “Reasonable & Customary” Payments
Many health insurance companies don't pay the “full” amount of what your doctor's office charges. Instead, they pay what has become known as “reasonable and customary” payments. However, a Senate investigation may uncover foul play by the insurance industry.