There was a time when the liability insurance industry hid behind front groups to accomplish things, well aware the public generally detested them. Back in 1994, a representative from the American Tort Reform Association’s PR firm, called APCO, explained its "grassroots" strategy and the need for front groups in a speech before a gathering of corporate public affairs executives sponsored by the Public Affairs Council, an organization of some 500 corporations and trade associations. He said,
"You need to have credibility and that means when you pick people to join your coalition, make sure they're credible. And if they're not credible, keep them away. In a tort reform battle if State Farm - I think they're here, Nationwide - is the leader of the coalition, you're not going to pass the bill. It is not credible, O.K., because it's so self-serving."
Ha. These days they're not hiding - at all. They're brazen about what they want to do, and that is (to put it simply), to take money out of the hands of (sometimes) destitute policyholders and put right back into their own swelling pockets. Texas is a good place to start.
The prime sponsor of an anti-policyholder travesty known as Senate Bill 1628, which is moving quickly through the Texas legislature, is the owner of an insurance agency. That hasn’t stopped him. Writes the Texas Tribune:
A controversial bill that would make it harder for homeowners and companies to recover certain damages from their insurance companies — cheered by the insurance industry and criticized by liberal groups and some businesses — cleared the Texas Senate on Thursday.…
The bill would establish a two-year time limit on seeking claims. And before being allowed to sue for deceptive acts or unfair claims handling, policyholders would have to provide advance written notice, sign a statement attesting that damages occurred and show proof of damages. It would also offer certain new immunity protections to insurance agents and adjusters who are named in lawsuits. And the bill would lower the penalty that insurance companies face for late payments.…
“It expressly immunizes wrongdoers,” said state Sen. Kirk Watson, D-Austin. “That means a Texan who was wronged by their insurance adjuster or an insurance agent would be in a position of not being able to hold them accountable.” …
“If passed it would put homeowners, businesses, schools, churches and the rest of the state's insurance customers at extreme risk. It would neuter the penalties that insurers must pay when they are caught delaying or denying legitimate claims,” Alex Winslow, the executive director of Texas Watch, a liberal consumer rights group, wrote in a column for TribTalk, a sister publication of The Texas Tribune.
Businesses are against this bill too. Everyone is except the insurance industry.
Ernest Martin, a partner in the Dallas law firm Haynes and Boone LLP, said he was representing a variety of business clients who were worried about the bill, including homebuilders Trammel Crow Residential, La Quinta Inns & Suites and Sovereign Bank.
“Business policyholders in Texas spend millions of dollars on insurance premiums to protect their property, business, and various business interests,” Martin said in written testimony provided to senators. “Many businesses would be financially crippled or significantly deterred without the insurance protection they purchased.”
David Stein, owner of the Roger Beasley Automotive Group of Central Texas, also criticized the bill during a recent committee hearing.
“Why are we looking at a bill that is pretty much strictly in favor of the insurance companies?” he said. “Where in this bill does it protect families? Where in this bill does it protect the small businesses, the medium or large businesses? Nowhere.”
Texas Watch has a Change.org petition going. Here’s what they say:
The bill rolls back decades of important policyholder protections. It incentivizes low-ball settlements, effectively immunizes insurance adjusters, agents, and employees, severely restricts when claims must be made, and creates “gotcha” provisions that allow insurers to delay payments on valid insurance claims.
Sign the petition but please do it fast.
Meanwhile in Michigan, there is an equally terrible bill that would dramatically change the state’s auto no-fault rules, drastically cutting reimbursements to medical providers and families. Last week, “a group of protesters picketed outside the AAA Insurance office in Troy to voice their anger."
“It’s a terrible public policy,” said John Gwynne Prosser who is associated with The Concerned Association of Patients and Providers that organized the protest.
“This is nothing more than greed” by the insurance companies, Prosser said.
Prosser said Michigan is the only state in the United States that guarantees required care to the victims of auto accidents without them going bankrupt due to medical bills, and if the bill becomes the law, many victims will not get the care they deserve, including 200 veterans.
Prosser is also the president of Neurotrauma Association which explains in a video on its website why Michigan’s no-fault insurance is important.
For more than 40 years, thanks to a vote we, the people, took in the 1970s, Michigan has led the nation in compassion for victims of catastrophic accidents, people like Erica Coulston, who used to spring out of bed each morning as an active, vivacious 23-year-old. Then, in 2007, a car crash in which she wasn't even driving left her "in the blink of an eye ... a quadriplegic ... paralysis of my legs, arms, hands and trunk muscles. ... I can no longer sweat like I used to. … I have no bladder or bowel control. ... I require assistance with showering, dressing, preparing meals. ... I have chronic neuropathic pain ..."
She said all this in a testimony this past week before our state legislators, the majority of whom were insensitive enough to keep rushing through a bill that would change Erica's life and those of victims like her forever.
It is shameless. And it must be stopped.
CAPP also notes, “when someone is seriously injured in states that cap benefits, and the bills pile up, the accident victim ends up declaring bankruptcy, and then move on to Medicaid, with taxpayers picking up the tab.”
So let me amend what I said earlier. They're brazen about what they want to do, and that is (to put it simply), to take money out of the hands of (sometimes) destitute policyholders and taxpayers and put right back into their own swelling pockets. If you can think of a stronger word than “brazen,” let me know. It will surely fit.