Category: Legal News

This stunning article in the Herald Tribune is a must read for anyone who has Allstate Insurance. Last week Allstate Insurance posted online 150,000 pages of documents that reveal a national strategy on Allstate’s part to force customers to accept lowball settlements or face years of litigation in court.

The documents describe a two-pronged strategy.

“First, the company evaluates claims with a computer program called Goliath designed to reduce payouts by as much as 20 percent of what the company once paid for the same injuries.

Second, Allstate pushes policyholders to accept quick settlements without the help of lawyers. Policyholders who try to fight for more money face Allstate attorneys coached to refuse to negotiate and to drag out litigation.

The approach often forces car accident victims to take what Allstate offers right away or spend years in court while their bills go unpaid — a strategy Allstate spelled out in guidelines for claims adjusters that force the claimant and attorney to think about the obstacles they must overcome …”

Allstate wanted to change the culture of how claims are made. It knew that most lawyers will take a one-third fee, and that cases that are prolonged in litigation, thus more costly, would ruin the economics of hiring a lawyer. Conversely, lawyers who know litigating small cases for a long period of time for a small fee is not worth the effort and over time will quit taking those cases. The result is that people with legitimate claims, who are properly insured, are denied full justice because Allstate has a corporate policy to increase profits.

“The insurance company saw reduced payouts as a way to increase profits. Early on, consultants promised that driving down the “fair market value” of soft-tissue injuries, such as a fractured spine, chronic pain or limited mobility would generate profits “shareholders will notice.” Combined with similar changes to Allstate’s home insurance and collision programs, they predicted, the yearly gain could reach $1.1 billion.”‘

Get this, in a PowerPoint presentation, Allstate executives were advised to convince policy holders that they didn’t need lawyers, and then target those who hired lawyers by delaying the payment of claims or forcing protracted litigation. According the article, Allstate wanted to “send a message to the market.” Those who don’t play the new game will get “boxing glove” treatment.

When the AMA published the Sixth Edition of its Guides to the Evaluation of Permanent Impairment, it contained new language that restricted chiropractic evaluations to the spine only. The restriction drew sharp criticism from the American Chiropractic Association. In a letter to the AMA, the ACA questioned the legality of restrictive language related to evaluations by doctors of chiropractic and accused the AMA of violating the permanent Wilk injuction.

The AMA responded by issuing a correction. The Guide will state in relevant part that: “Impairment evaluation requires medical knowledge. Physicians duly recognized by an appropriate jurisdiction should perform such assessments within their applicable scope of practice and field of expertise.” AMA will be mailing out the correction and future publication of the Guide will contain the corrective language. For all plaintiff’s attorneys, any attempt by a defense lawyer during cross examination of a treating chiropractor who has testified as to a whole person impairment should do one of two things: 1) object to the cross examination on the grounds that the langauge being cited by the defense attorney from the Guide has been retracted and corrected; or 2) allow the questioning and then on re-direct present the fact that such language was subsequently corrected by the AMA. It is my opinion that the former is the better strategy.

A federal jury in Pittsburgh, Pennsylvania, awarded $28 million to the family of a 12 year old boy who was shot by police on Christmas Eve in 2002. The boy was unarmed at the time he was killed. After the boy’s death, his family filed a wrongful death claim against Troopers Samuel Nassan and Juan Curry alleging that they acted intentionally. Apparently, the jury agreed. The jury deliberated for four days before rendering their $28 dollar verdict.