This story is based on a recent settlement and the unreasonable negotiation time it took to obtain a fair and just outcome for a client.
Allstate has faced criticism over the years for its controversial claims handling practices, which are commonly referred to as "The 3 Ds." While it is unknown what the exact procedures are that guide junior adjusters, my experience tells me that the 3 Ds are not far from the truth.
"Deny, Delay, Defend" is a strategy that has been used by many insurance companies when handling claims since the early 1990s. The idea behind this strategy is to deny or delay claims to maximize profits. By denying claims outright or delaying payments, insurance companies hope that policyholders will eventually give up or settle for less money than they are owed. Sadly, many injured people fall victim to this strategy.
Allstate has been accused of using this strategy more aggressively than other insurance companies. In our recent settlement we submitted a timely offer of compromise (a.k.a. demand letter) outlining the entirety of the claim. We provided medical records, a police report, and many other documents. Allstate valued the claim at $24,000, or $1,000 more than the total medical bills. This was an unfair and bad faith offer since victims are entitled to medicals, future medicals, lost wages, future lost wages, pain and suffering, inconvenience, and incidental expenses as a matter of law.
Months went by and no new information was provided, nor did any substantive facts change. By all measures Allstate reasonably had everything they needed to offer us a fair settlement value, yet they continued to play games. We filed the lawsuit and they spontaneously offered $50,000 policy limits to settle. LITERALLY NOTHING CHANGED. This highlights the greed of insurance companies and their willingness to let people wait long periods of time in hopes they will give up.
A deeper look inside Allstate’s strategy:
Allstate's strategy of denying claims causes frustration and financial hardship for many auto collision victims. According to a report by the American Association for Justice, Allstate has a history of routinely denying claims, even in cases where the policyholder has a valid claim. Allstate has been accused of denying claims for various reasons, such as claiming that the damage was pre-existing or that the policyholder did not provide enough evidence to support their claim. Many times they do this in bad faith with little to nothing to back up their position.
If they don’t deny your claim they will play the delay game. It is my experience that the company intentionally delays the processing of claims to avoid paying out compensation in a timely manner. This can cause significant financial strain on policyholders who are waiting for their claims to be processed. Delays can also lead to policyholders having to pay out-of-pocket for expenses that should have been covered by their insurance policy. This tactic is common and shakes out many auto collision victims who are in dire need of money to pay for the damages caused by the other driver.
Finally, Allstate aggressively defending claims in court to avoid paying out compensation to policyholders. However, they can only do so much to defend a terrible driver. If they take the misstep of forcing Apex Law to trial, we will seek money damages far exceeding policy limits all while maximizing their exposure.
When an insurance company opens the door of injustice with bogus offers, Apex Law will slam the door in their face.
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