Good Neighbors Are Hard to Find When It Comes to Insurance.

Good Neighbors Are Hard To Find When Filing Claims

By now we’ve all seen the commercials where some catastrophe befalls an insurance customer for a national insurance company.  Surprisingly, the customer is not too worried.  They sing a little jingle about “good neighbors” and poof! an insurance representative shows up to handle the situation.  This representative calls the person by name and tells them not to worry, they will handle whatever problem has presented itself.

The commercial is meant to give the viewer the impression that if you have insurance with this particular insurance company that any problems you might have will be met by a known, friendly, and helpful insurance agent.   This scenario couldn’t be farther from the truth.

Consider a typical situation when you first buy car insurance.  You go to a local insurance agent and request insurance for your car.  You might have had a previous relationship with this agent over many years.  He is a representative of the insurance company.  The agent’s job is to take down some information, have you fill out the necessary paperwork, and submit your application, along with your first month’s premium to the insurance company.  He then receives compensation in the form of commissions based on each application he submits that is later approved by the insurance company.  Your interaction with an insurance agent is likely to be very pleasant.  Does this commercial show anything remotely similar?

Now consider a typical situation when you file a claim against an insurance company after some type of loss, such as a car crash.  This might be your insurance company or somebody else’s.  You get a call from the insurance company adjuster who says he will be handling your claim.  It is doubtful you have ever met this person before.  Unlike the agent who is an independent representative of the insurance company, the adjuster is an employee.  He is paid a salary by the insurance company.  His job is to get information about your claim, review the damage (called adjusting), and then offer to settle your claim.   Your interaction with an insurance adjuster isn’t likely to be as pleasant.  But, the commercial comes a lot closer to showing this scenario doesn’t it?

The purpose of the commercial is to make you identify with something about insurance that you like, such as your insurance agent, while giving you the impression that your agent is involved in the claims process.  Well, they aren’t.  The unknown, potentially adverse, and likely biased insurance adjuster is.

The insurance agent facilitates  your purchase of insurance with the insurance company.  The adjuster is the insurance company. The insurance adjuster’s job is not to facilitate anything, but to make sure the insurance company doesn’t pay out anything unless it has to, and only then as a little as possible.  Insurance companies don’t make money paying out claims.

But what if you disagree with the adjuster about the value of your claim?  What if you believe the adjuster is improperly delaying or denying your claim?  What if you think the adjuster is being unfair?  What if you think the adjuster has undervalued your car, or other property?  Do you think the insurance company is acting like a good neighbor then?

Don’t be fooled by commercials or catchy jingles.  Insurance companies are in business to make money.  They do not make money by paying out more on claims than they take in on premiums.  Adjusters know this.  The next time you suffer a casualty loss or turn in an insurance claim, remember no amount of catchy singing is going to make your dealing with the insurance company pleasant.  When you ask an insurance company to settle your claim remember good neighbors are hard to find.