For those wanting a chuckle, take a look at the following clip lampooning insurance companies.
http://www.youtube.com/watch?v=bVpX5fUvPlg. The clip calls attention to the double standard insurance companies refuse to acknowledge in their own affairs. Some of the worst corporate fraud in the country has been perpetrated by insurance companies on consumers. Some examples of these were pointed out in my recent blog “Ten worst insurance companies”. For instance, the post described how the world’s largest insurance company, AIG, committed massive corporate fraud and had to pay 1.6 billion to government regulators as a penalty. It seems like insurance companies approach our state legislature every year crying about how people committing insurance fraud hurt profits. They usually come up with some figure they’d save if the fraud was stopped and want tougher laws penalizing consumers who improperly collect benefits. The figure they’d save is made up by the industry and there is usually no data provided as to how they pick the number. What is never provided of course is the sum that fraud by the insurance industry costs America and the purchasers of insurance. My guess is this figure dwarfs the losses caused by bad individuals committing insurance fraud. Not that going after and punishing bad apples who commit insurance fraud isn’t a good idea, it’s just whenever a legislature wants to make the new or tougher law apply to both insurance and consumer fraud the insurance companies back away. Every time I settle a case I get barraged with forms from the insurance company that they demand my client sign. They usually state in big bold letters that anyone that gives false or misleading information to an insurance company can by prosecuted criminally. I’d sure like to have the same rules apply to the insurance industry. As it stands now, the worst that can happen if state regulators catch them cheating the public is a fine and some restitution. Often they make more money than they ever have to repay. But nobody goes to jail. That only happens if you cheat an insurance company. This is why the YouTube clip says it all.