Friday, September 16, 2005

Insurance Companies looking out for #1

From John Cole:

Mississippi Attorney General Jim Hood sued insurers in his state Thursday for taking advantage of Hurricane Katrina victims and not covering damage to homes caused by flooding in the aftermath of the storm.

Mississippi Farm Bureau Insurance, State Farm Fire and Casualty Co., Allstate Property and Casualty Co., United Services Automobile Association and Nationwide Mutual Insurance Co. were listed as defendants in the suit.

Hood’s office is investigating charges that claims adjusters from these companies offered homeowners affected by the storm $3,000 in personal expense money in return for signing waivers agreeing their home’s damage was from a flood and not from wind.

Apparently, the position of the insurance companies is that even though these folks thought they were buying hurricane insurance, the companies only will pay for wind damage (which is not surprising, because rarely do insurers in flood plains offer flood insurance*- you have to go through FEMA for that). The problem is, how do you prove your house was damaged by wind, and not the water? And what about the fact that the storm surge is caused by the wind?

Essentially, this is like having medical insurance that covers gunshot wounds, but doesn’t cover wounds by small pieces of metal that act as a projectile. It makes no sense, and, based on the information I have right now, it is an act of bad faith and is unconscionable.

And I am not impressed with claims this will ruin insurance companies. Years and years of record profits would suggest they have a way to rebound. Or they should find another way of making a living, something a touch more honorable. Like beating old women over the head on their way to church and stealing their purses.

*Post edited.

...but we should privatize more services currently handled by the Federal Government, because private corporations are notorious for putting the American People before profits.


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