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An Atlanta lawyer who deals mostly with commercial liability claims believes that insurance companies are selling the promise of protection, but in fact never intend to pay.

Writing on an IT security website, the attorney asserts that some firms have altered the insurer-insured relationship to one of adversaries, with the insurance companies vigorously fighting claims made by their customers. He says that what they promise — and what they actually deliver — are oftentimes in direct opposition to each other.

With today’s litigious atmosphere, and given the damages often paid by carriers, it is responsible for carriers to remain vigilant when paying claims.

But when an insurer acts in its own interest and not in the interest of its premium-paying clients, it goes against the basic fabric of fair play and fair business, as the attorney adequately describes it.

3 Responses

1. mattwi Says:
   March 3rd, 2010 at 10:43 am

   But surely, the insurance contract is just that. A contract. If there is no real basis to reject a claim, aren’t insurers inviting additional costs on their heads defending claims that are perfectly justified??

2. John Robertson Says:
   March 5th, 2010 at 9:59 am

   The idea that commercial insurer never intend to pay claims is simply not true. As a business insurance specialist for several decades I have written and serviced businesses ranging from the proverbial main stree to wall street. As a part of my service to clients I review the reams of liablity claims that businesses insurance policies incur and in fact do pay. The main reason is that insurers may keep a reserve open longer than the client might wish for obvious reasons. But my experience has been that insurers try to fairly pay what they owe.

3. Ken McGuinness Says:
   March 8th, 2010 at 6:16 pm

   Liability policies will always pay, but maybe not in the amount, or time frame you are looking for. They pay for defense costs and they may pay in other ways too, including liability or indemnity obligations. However, here is a famous quote that was captured in a New York Times Sunday magazine article on Maurice Greenberg, and that is: “Pay not claim before its time.” For a long time that strategy worked for AIG and companies where you might find an ex-AIG running the show, but so much has changed since that article was written I can only imagine such an appraoch would be really bad for busienss. Look at the individual company philosophy before making such broad statements about the industry, you might be surprised

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