Are You Really in Good Hands with Allstate?
Attorney
(866) 735-1102 Ext 576
Allstate Insurance is easily the most prolific advertiser of auto and casualty insurance lines. It runs a series of television commercials starring Dennis Haysbert (of Major League fame) that cleverly portray real life situations, such as rear end auto collisions, and some not so real life situations, like wayward college football fans running their car into a statue of renowned coach Bobby Bowden, to illustrate the need for insurance. The pithy theme of each ad is driven home with the statement "that's Allstate's stand", and with the suggestion that you are not in good hands unless your insurance is through Allstate.
However, experienced consumer attorneys know that Allstate's advertising claims are in stark contrast to its every day claims handling practices. Trial lawyers are in a unique position to judge the overall approach of insurance companies because they deal with a broad cross-section of insurance companies in a wide variety of factual scenarios. During the handling of thousands of claims, the true corporate color of an insurance company shines through. And after reviewing a high volume of claims documents recently, the American Association for Justice unequivocally rated Allstate as the worst insurance company for consumers.
Allstate policy holders might feel that the wrap on Allstate is the result of sour grapes on the part of attorneys who are resentful that their outrageous claims were not paid by the company. However, Allstate's rating was not solely the result of a "boxing glove" corporate policy of lowballing legitimate claims made against its policy holders, although that was certainly part of it. Allstate has also made clear it was willing to get into the ring and duke it out with its own policy holders in the name of increasing profits. In addition, its low rating was based on paying high executive salaries as a reward for successful lowball tactics and charging higher premiums, in part to pay for its expensive advertising.
One recent Allstate commercial illustrates another goal of the Allstate advertising campaign. The ad shows a court room scene where the judge imposes a judgment on a young man (the defendant) in the amount of $100,000 after an auto collision. The defendant's attorney turns to the injured person's (plaintiff) attorney to explain that the defendant has only $50,000 in insurance. The plaintiff's attorney replies that the defendant has a college fund that can be used to pay the balance of the judgment, and concerned parents ask their attorney - "can they do that?" The defendants attorney replies that they can.
The ad is designed to mislead the viewer into believing that the defendant is an innocent victim (it was just an "accident"), and that both the court system and a greedy plaintiff's attorney are the victimizers. This promotes the belief that trial lawyers and frivolous lawsuits are the cause of high insurance premiums.
In real life, such a scenario would likely be the result of an auto collision caused by a speeding driver who was distracted by his cell phone and ran a red light, sending the other driver to the hospital with serious, possibly permanent injuries. The other driver incurs medical expenses of $25,000, loses income from work of $10,000, and has ongoing pain and limitations. Although the value of the pain, suffering and inconvenience is well in excess of $15,000, the other driver is willing to settle out of court for the responsible driver's $50,000 policy limit to avoid going to trial, and probably out of a moral feeling that he does not want to collect against the responsible driver's personal assets.
Even though the other driver is without fault, the insurance company for the responsible driver puts on its boxing gloves and offers only $40,000, which is less than the policy limit of $50,000. The attorney for the injured person has no choice but to spend thousands of dollars to take the case to trial to seek the full value of the injured person's damages. A jury of reasonable people taken from the general population (rather than a judge as portrayed in the ad) determines that the total value of the injured person's loss is $100,000. Now, because of the insurance company's lowball at all cost mentality, there is a judgment against the responsible party for more than his insurance coverage.
Allstate Insurance has engaged in a successful marketing campaign. But this expensive advertising comes at a cost. The consumer warning caveat emptor is especially appropriate when you consider purchasing insurance from Allstate. Purchasers of insurance from Allstate may find that the "good hands" have boxing gloves on, and making a claim is like ringing the fight bell.