Allstate has generally become known as the worst insurer in America due to its “deny, delay, and defend” method of handling claims. A new book describes the tactics used by the company that allowed it to record historic profits over the last decade. “From Good Hands to Boxing Gloves”, written for lawyers about two years ago by author Stephen Berardinelli, is now out in a more readable and smaller version for consumers. The new book explains in detail how insurance consultant McKinsey & Co. advised Allstate to institute new claims handling practices that would eventually save the company billions of dollars in claims. The book shows how Allstate and other insurers with claims systems also created by McKinsey, reaped billions of dollars in profits by improperly denying claims. It even explains how insurance companies profited by denying Katrina claims and forcing the cost to rebuild onto American taxpayers. It details how Allstate’s claim handling process was completely redesigned to make claimants go away or accept pennies on the dollar. If they refused, Allstate threatened to fight back with banks of lawyers and years of costly litigation. Recently the American Association for Justice released the results of a nationwide study to determine the top ten worst insurance companies in America. Allstate was joined in the top ten by State Farm, Farmers and Liberty Mutual. All of these companies have adopted claims handling programs similar to Allstate’s.
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