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Ten Worst Insurance Companies in America

December 12th, 2011

The American Association for Justice (AAJ) has published a document listing the ten worst insurance companies in America. To come up with this list, researchers at the AAJ undertook a comprehensive investigation of thousands of court documents, SEC and FBI records, state insurance department investigations and complaints, news accounts from across the country, and the testimony and depositions of former insurance agents and adjusters.

Is your insurer on the list?

AAJ’s List of the Worst Insurance Companies

  1. Allstate—the worst of the worst, called a poster child for insurance industry greed. The number of complaints filed against Allstate are greater than those of almost all its major competitors combined. The company fights its clients to avoid paying for claims. According to a former Allstate adjuster, “We were told to lie by our supervisors—it’s tough to look at people and know you’re lying.” Former employees call the company’s unofficial policy the “three Ds”: Deny…Delay…Defend. Adjusters say they were rewarded for keeping claims payments low, even if they had to deceive their customers.
  2. Unum—one of the nation’s leading disability insurers, with a long reputation for unfairly denying and delaying claims. As an example: Debra Potter, who developed multiple sclerosis and became totally disabled. But when she filed a claim for disability, Unum denied the claim saying, in effect, that she was making it up without doctor verification. Her doctor wrote note after note explaining that the disease and disability were real, but Unum continued to deny the claim for three years. She only got justice when she hired a lawyer.
  3. AIG—the world’s biggest insurer, but with a long history of claims-handling abuses.
  4. State Farm—the nation’s biggest property casualty insurance company, with a reputation for its deny and delay tactics. According to the AAJ, the extreme lengths the company goes through to avoid paying claims include forging signatures on earthquake waivers after the deadly Northridge earthquake, and altering engineering reports regarding damage after Hurricane Katrina.
  5. Conseco—sells long-term care policies that are supposed to help take care of people when they are old and need help.  The company’s tactic is to wait and delay, knowing that if it waits long enough to pay out claims, its customers will die.
  6. WellPoint—according to the AAJ, Wellpoint routinely cancels the policies of pregnant women and chronically ill patients.
  7. Farmers—rewards adjusters who meet low payment goals, sometimes with such measly rewards as pizza parties. One example: 60-year-old Ethel Adams, who was involved in a multi-vehicle accident that put her in a coma for nine days and left her with devastating injuries, including the losing the use of her legs. Incredibly, Farmers denied her claim, reasoning that the driver at fault had acted in a moment of intentional road rage, and thus the crash was not an accident. The company’s denial caused an outcry, and Farmers Los Angeles headquarters was flooded with calls and emails from angry policyholders threatening to boycott the company. Farmers only caved when the Washington State Insurance Commissioner threatened the company with legal action.
  8. UnitedHealth—this company has been plague by accusations of greed so rampant that it puts patients at risk.
  9. Torchmark—this company has subsidiaries that offer low-cost burial insurance, cancer insurance, and life insurance. The company has come under fire for a variety of transgressions, including charging minority policyholders more than whites.
  10. Liberty Mutual—like other companies, they adopted a policy of deny, delay, and defend. In addition, Liberty Mutual has been cited by regulators for systematic bid-rigging.

To read the full report from the American Association for Justice, click here:  The Ten Worst Insurance Companies In America