People often overlook a fundamental fact about insurance: every dollar the insurance company pays out to the insured is a dollar less that the insurer gets to keep. In other words, the insurer-insured relationship is always economically adversarial to some degree.
Marketing vs. Paying
Insurance companies need people to buy their policies, of course. And they operate in a crowded market: many insurance companies sell policies that are remarkably similar in terms of what is and isn’t covered. So insurers tend to emphasize concepts such as protection, security, and reliability when they advertise their products. Their ads and their sales force all emphasize the benefits that you, the insured, will get from buying a policy from them, your “friend.”
While you are paying premiums, the insurance company remains happy to see you and happy to see your money. If you’re lucky, years may go by before you have to file a claim under the policy. At that point, you may notice an immediate change in attitude, and you will begin dealing with people you’ve never heard of before: the adjuster, the investigator, and the claim manager. You have gone from being a source of revenue and referrals to a potential expense—the larger the claim, the larger the potential expense. In fact, you and all the other people who filed claims may prevent the insurance company from meeting its company profit goals, and may prevent various officers and employees of the company from achieving their own financial goals, bonuses, raises, etc.
The Claim Process
When you file a claim, it goes to the insurance company’s claims department. This may be a part of the insurance company, but these days it may well be a separate company that handles claims for insurers. In either case, the claims department may be understaffed and will, in all likelihood, have policies in place for deciding how to analyze, investigate, and settle claims. Those policies reflect the business interests of the insurer and, if there is one, of the separate claims handling company.
Large claims and claims that seem “fishy” to the person in charge of your claim file will be investigated much more thoroughly. That investigation will, in all likelihood, include an adjuster who tries to verify the facts about the claim and makes an estimate of how much the claim is “worth”—defined as the amount the insurer thinks the claimant will accept.
The adjuster may be employed by the insurer or be “independent.” In either case, the adjuster will have some authority to settle your claim. Experienced, trusted adjusters may be able to settle without consulting the claims manager; others will report their recommendations to the manager and await further instruction.
Adjusters are notorious for discouraging claimants from getting a lawyer. The typical approach is to emphasize how much it will cost to hire legal help and claim that you will be far better off by taking the adjuster’s settlement offer: you’ll end up with more money overall, and you’ll get it more quickly.
Or course, the insurance company may simply deny your claim on any one of several grounds: the loss isn’t covered by the policy, you didn’t do something you were required to do in order to make a claim, and so on.
When Do You Need A Good Insurance Claim Lawyer?
The adjuster and the claim manager know insurance far better than you do. You should immediately find an attorney who knows as much or more about insurance as they do whenever:
- You feel you’re being “low-balled” by the adjuster (there’s a reason he doesn’t want you to get a lawyer)
- The claim denial isn’t adequately explained
- The claim is denied for reasons that seem contrary to the facts
- The insurer is dragging its feet in making a decision about the claim, for no good reason
If you’re in any of these positions, call the Surrano Law Offices today and tell us about your claim. We have decades of experience dealing with the insurance industry, and we know how to get what you deserve from your insurer. We are located in Phoenix, Arizona and handle insurance bad faith claims nationwide.