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USAA Bad Faith

     USAA advertises the motto “We know what it means to serve.” I’m not sure how to match that up with the USAA that I deal with in the law practice.

     The Virginia Lawyers Weekly Blog  reports  a recent court case that was brought against USAA.  A Hampton Roads woman brought a bad-faith lawsuit against USAA for failure to pay her medical bills, under her medical payment coverage. Medical payment coverage is additional coverage under your own automobile policy that you can elect to purchase.

     In this instance, Sandra L. Simpson had been in a car accident and received treatment that resulted in medical bills in excess of $24,000. Under her policy, she had $10,000 in medical payment coverage. It should have been a simple procedure to just submit her bills and have them reimbursed under her USAA coverage. They denied payment for all but a few hundred dollars.

     She filed suit in Virginia Beach General District Court for the bills, her attorney fees and costs and for bad faith punitive damages. After she filed suit, USAA offered to pay the remaining amount of the $10,000. When she turned that down, they threw in an additional $500 for an attorney fee. She turned that down.

     The General District Court Judge returned a verdict for the medical bills, $1500 in attorney fees and $4,000 in punitive damages, plus the costs of bringing the suit. A total verdict of $13,187.

     I have about 9 or 10 medical payment  claims just like the Sampson case that I need to  file against USAA. We just settled another that was recently filed. It’s a regular occurrence.

     In our cases, they just decided not to pay the submitted bills. Then, they usually send a letter from some adjuster in some state like Texas, indicating that they don’t think the bills are reasonable or that they are too high.

      Wouldn’t it be great if you and I could just tell the phone, electric or cable that we won’t be paying this month… we just don’t see the bills as reasonable; And, they are just too high!

     I guess USAA just  figures that most will just go away and never file suit against them. That brings up the real question, “Is it really insurance coverage if  they don’t pay?”. Maybe their slogan should really be “We know what it means to be served with a lawsuit”.

      If you click here, you can find the results when I googled “USAA Bad Faith”. They are no strangers to bad faith damages after not paying benefits to their own insured.

      For pic o’ day, just as USAA has rules; so does this cat!

 

Insurance Company Hatred?

     It would be so peaceful to blog about starting a children’s book called “The Dog Who Eats Pancakes”. I could make it a story of health by discussing that pancake dog doesn’t only eat pancakes, because he doesn’t want doggy tires around the waistline.

     Think of it as a possible story of teamwork. Since dogs don’t have opposable thumbs, they can’t open up the pancake batter box to make their own pancakes. They need to rely on others and teamwork brings great joy (and pancakes). That inexplicable thumbnail on the side of the paw, doesn’t even work well in turning on the grill.

     Sure, that sounds like a framework but it doesn’t work real well for a legal blog. Instead, I write about an adjuster who asked me, “Why do you hate insurance companies so much?” I blog about the story of insurance that I see happening.

     An ESPN article by Bill Simmons,  described how the Miami Heat won the 2006 NBA basketball championship.  According to the unedited TV camera video that never made it to air during the game, their coach, Pat Riley, threw away his clipboard and  plays, and just screamed at his players during timeouts, like some boxing corner man:

  “You’re tougher than them! YOU’RE TOUGHER THAN THEM! Don’t let up! They are ready to quit! They are ready to fold! Keep attacking them! Keep getting to the rim! Keep knocking their a**es down! No layups! No dunks! Stay together! YOU ARE TOUGHER THAN THEM! YOU ARE TOUGHER THAN THEM!”

     I smiled when I read that, because it  mirrors what happens to me during the work day. For instance, I resolved two claims last week that were just about to go to trial.   At the time when I originally filed suit, about 8 months ago, one had an offer of $2500 and the other, an offer of $9000. This week, they settled for $30,000 and $25,000 respectively. 

     Nothing had occurred to make the claims worth more. In fact, they probably settled for a little under value at their current amounts. When I originally asked each adjuster why such a low offer, they both basically indicated, “it’s just what I have on it”.

     If you google insurance companies, you will see that they show increasing profits and increasing policy holder premiums. Meanwhile, they spend large amounts in lobbying, to fight insurance regulation. Their sole purpose is to generate a profit.

     When you see TV ads about purchasing car insurance, the ads are usually focused on saving money. I can’t remember one  ad about treating people fairly or trying to fairly resolve claims and not clog the court system.  Instead, they try for humor,  or to generate a good feeling about their spokesperson or how quickly or easy it is to get a quote.

     In my opinion, there is nothing wrong with wanting to turn a profit. There is nothing wrong in fighting legislation and regulation, if you are a business and you think that such enactment will hurt your business. However, when you fight for profit and you do so by acting in bad faith, fraudulently processing claims or simply breaking the law, you should have to pay for those harms.

     See, I can get myself riled up pretty quickly. It irritates me to get offers that are generated by some computer program of the insurance company, that has no bearing on the claim, until it gets transferred into their litigation section, where the computer now views the claim differently. Meanwhile, the message is put out that the people that are hurt, are viewed as greedy, frivilous or overreaching. You can see how I start saying in my head, “You’re tougher than them; right is on your side; you’ll outwork them!”

      I throw away the clipboard and just get ready for trial. Ultimately, insurance companies will either accept responsibility and pay, or face the music of the jury verdict. For now, business as usual for them is just to put off paying, until they have to pay. At least that’s my experience.

     Maybe someday I’ll get to write about a dog and his pancakes. For now, who is up next? That knock at the insurance door, Adjuster,  might tear your playhouse down on this next case. Now why do you think that he would ask me if I hate insurance companies?

    

Virginia Fraud Fighters

     The prospective client called and asked if we would meet him at his business.  “Of course”, I said, since we advertise that “we will come to you”. Upon arrival, we asked to see “Jim”. (I use that name for confidentiality and I once heard a story about a mule named Jim)

     Prospective client “Jim” came walking out, from behind his counter. He had a sledge hammer in his hand. That caught my attention and I half wondered if he thought that was how to negotiate a legal fee.  He asked if we wanted to see his car first, before discussing the case. We followed him to the parking lot. Then, he began to raise the sledgehammer toward the car bumper and asked how much damage we wanted to his car, “to make the case worth more”.

     Needless to say, except for the frightening memory of that event, I have no other story to tell about that case, as we quickly found ourselves travelling down the highway, without a client. I left him, his case and his sledgehammer behind.  

     The Virginia State Police are running a full page advertisement in the newspaper  that honors eight of Virginia’s top fraud fighters. Each of the recipients of the Fraud Fighter Awards have taken some action  to stop insurance fraud. They correctly state that, ultimately, everyone pays a price for insurance fraud. That’s why, when I see a mention of insurance fraud, my mind goes back to that sledgehammer story. I wonder if “Jim” is still out there. I suspect that he got rewarded in a way that he didn’t expect.

     Conversely, when I see campaigns against insurance fraud, I wonder why there is no mention of insurance companies or adjusters, who have committed fraud this past year. In my experience, it’s not just a one way street. Collecting premiums, with an intent to figure out a way to keep from making payment to the insured, also constitutes fraud.

     Virginia has a code section (8.01-66.1) that deals with insurance companies that deal in bad faith. In my practice,  I see it. For instance, I recently submitted  different medical payment packages to the same insurance company, on behalf of  different clients. The packages included the full billing, coding and all information relating to the treatment. In fact, the coverages were the clients’, since these three carried medical payment coverage on their car insurance. Medical payment coverage is an elective coverage that costs a small extra premium, to help pay medical bills resulting from a car crash, without consideration as to who is at fault.

     In these  submitted packages, a form letter came back that basically said something to the effect that no payment was forthcoming, until all information about the bills was submitted that related to when the treatment occurred and what kind of treatment was included. Of course, these original packages had correctly included such information. This insurance company apparently had come up with the idea to delay payments by sending out these “we need more information” letters.

     I wrote a form letter response to the three different adjusters that had sent these form letters. I reminded them of the package that had been sent, that had included all the information that had been requested in the “delay payment letter”. My letter may have also said something about preserving all evidence and their file, so I could document their bad faith handling, at a later date. I might have even sarcastically asked for the middle initial of the adjuster on the letter, so I could make sure that the “fraud plaque” I was sending, would properly show the full name. OK, maybe I’m getting a bit revved up. Imagine,  full payment checks showed up within 7 days, without any other explanation.

     The point of this blog is that insurance fraud is bad. It hurts deserving clients and it logically causes premiums to increase.  However, I don’t think that insurance companies should get a free pass on their conduct either. A quick google of insurance bad faith brings up a lot of examples of insurance companies not acting in good faith. As I have said in a few prior blogs, the fight continues! I wonder what ever happened to Jim the Mule?

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