20 Oct


Many people pay their insurance carrier for years (decades even) and have what they believe is a good “rapport” with their insurance company; and yet many times they still get dropped for one or two minuscule claims. That is why it is often better to save making a claim for when it is a real and substantial matter, and an issue worth pursuing.

As such, you do not want to make minimal or semi-frivolous claims. It is best if you can save your insurance for when you REALLY need it; when it is important to use. The big one. Many insureds treat small or insignificant claims almost like a deductible; something you only write off. Many wisely feel that incurring a claim on your record, and having your rates raised (or being canceled altogether), for a mere $100 – $300 claim is simply not worth it. Nearly always, there will come a substantial accident, injury, and claim – all well worth pursuing, that will more than makeup for all of these insubstantial little matters you let slide. Likewise, many people adjust their “deductibles” to save money on their rates. Just changing the deductible amounts on claims from $100 to $500 can save a fair sum of money. Changing deductibles to $1,000 saves even more.

Many feel that, yes, a higher deductible will end up costing them a few hundred dollars out of their claim; however, they are not even going to MAKE a claim unless it is going to be thousands and thousands of dollars – a LARGE claim. Therefore, the thinking is, if the money saved in other areas (deductibles, med pay, towing, etc.) can be used to buy even higher amounts of UM/UIM coverage, then it was worth it. For if and when the large claim IS finally made, they want $500K or $1 million in UM/UIM policy limits to go after. That may sound like a lot of money, but many claims with disc injuries and surgery are $100K – $200K in just MEDICAL bills! Often they capture every penny of the $1 million UM/UIM policy. Obviously, one needs to weigh the potential for use (i.e. how often a claim MIGHT be made) versus the yearly premium savings, to determine if this is worthwhile for them.

Wise people look at insurance not so much for day to day, “nickel-and-dime” claims, but for the really serious and important ones. When looked at like this, things make a little more sense. If you save your insurance for something of magnitude; when the insurance company pulls your claims history [and they WILL review that, considering any prior personal injury claims] they will see you have a claim-free history. A plaintiff with ZERO prior claims. This not only tells them something about YOU, but it takes away from them one of their primary arguments; that of “preexisting” or “prior” injuries. This one of their favorite topics of discussion in accident cases, as well as a primary way they try to avoid paying a claim. A clean claims history not only helps establish you and your claim as legitimate but that you are not what they deem a “professional plaintiff,” or a chronic claims maker.

Insurance companies, unfortunately, love to forward these kinds of arguments. The odds are that you will be in at least one (if not two or three) major accidents in your life. The MAJOR claim is the one you are waiting for. THAT is the one you are carrying your serious insurance coverages for, and that is the one you want to be ready for when the time comes. If you are in a major impact, the odds are strong that you may incur some form of disc injury to your neck or low back. As previously indicated, symptoms from these types of injuries are often slow to manifest and may take a year or more to develop fully. Therefore, you want to be careful and not in a rush to “hurry up and settle” your claim. If put together correctly, these types of claims can be quite large. Unfortunately, many injured people do NOT have adequate insurance, or the right kind of insurance when this accident comes along; or, just as badly, they effectively help build the defense for the insurance company because of numerous prior claims.

If this is the type of case and injury you have incurred, and you have tried all forms and modalities of treatment; you may now be left with only surgery as your last option. Cases of this magnitude (depending on particulars) can go for $250K – $1 million, and even more if surgery is actually undergone. THAT is the case you want to be ready for, and carry adequate coverage for. With claims of that size, you also should consider aligning yourself with a top and respected structured settlement company, one which you can rely on and also be able to give you the type of coverage and setup you must have with a claim of seven figures or more. With the laws as they currently are, it is not only rare but often impossible to get the insurance company to pay out in full with a settlement of one million dollars or more. By getting the relationship now so when you need them it is a simple call. You simply cannot count on the opposing party, the often irresponsible person who caused the accident, to have adequate coverage to protect you from such an injury or claim. Only YOU can do that for YOU. What is frightening is how utterly common this type of injury is.

Just as there are insurance companies that tend to play the “shill game.” You may have seen this yourself, or been a victim on a crowded tourist street. There is a popular game called three-card monte. All you have to do is identify the right card after the dealer shuffles them. The person playing wins easily, over and over and as you watch, you can identify the card simply. “Easy money” you think to yourself, but when you step up, you lose. Thinking that you just weren’t paying attention, you play again and again. Soon, you are down $100 and walk away dejected. What you don’t realize is the person who was winning over and over was “the shill” and was in on it with the dealer. The same happens in the insurance and structured settlement industries. What you see isn’t what you get. You simply cannot count on the opposing party, the often irresponsible person who caused the accident, to have adequate coverage to protect you from such an injury or claim. Only YOU can do that for YOU. What is frightening is how utterly common this type of injury is.

Structured settlements were created with the good in mind. To help pay someone’s living and medical expenses over time that was seriously injured in an accident or a victim in a product liability case. Structured settlements can be traced back to thalidomide litigation back in the 1970s. Back then, the victims were infants who would need not only medical treatment but daily care due to the disfigurement they unfortunately had. Giving them a series of monthly payments was the best way to ensure their expenses were taken care of and their way of life would be the best possible under the circumstances.

Even though this was originally put together for the greater good, insurance companies quickly realized that a structured settlement was an inexpensive way to settle a lawsuit. How? Simply put, the figure offered would seem like a lot to the victim, but because it was paid over time, often in 20-30 years, the real value of the settlement was a lot less due to inflation and the difference of the value of future money compared to the value of money today.

For example, a settlement of $75,000 in 1982, paid over 20 years, actually becomes a hard cost of $10,000 to the insurance company. The same is true with a $225,o00 settlement, which cost the insurance company less than $15,000 to set up the annuity. This is all done through legal loopholes and victims are hurt again thinking they are getting a great settlement, but the terms and conditions of receiving the money are often not what they expected or what they were told verbally. The settlement offer they sign is different and some victims die before they receive a dime of the settlement money.

What happens if the victim dies? Sadly, many settlement agreements state that if the victim passes away the annuity returns to the insurance company. Yes, you read that right. This is why laws were changed to allow for victims to cash in their annuities and structured settlements for cash up front instead of waiting for the payments to complete or even start. If you decide to sell your structured settlement, make sure to pick DRB capital which is considered the best structured settlement company.

How can you avoid getting duped by an insurance company? Simply ask for the “present value” of the structured settlement that is being offered instead of the amount they are dangling in front of you. I guarantee you, if an insurance company offers you $75,000, but then has to tell you the present value is a mere $10,000 you are not going to accept their offer.

How do they do it? Just as in the example of the three-card monte, the insurance company uses “slight of hand” in order to fool you in thinking you are getting a great settlement, when in fact, you are not. Insurance companies state in their internal communication the importance of using structured settlements for company growth and profitability.

“The primary objective in the current and future use of structured settlements is to fully maximize corporate profits and growth while reducing claim loss and the rate of expense when it comes to claim settlement.”

You would think that structured settlements are only offered on large settlement offers, but you would be wrong. Structured settlements are offered even on claims as low as $5,000. If you are offered a structured settlement and do not receive the proper disclosures from the insurance company, chances are good you are going to get far less than you expect.

With payments often being in the 20-30 year range, your medical costs will only go up and what is affordable today will not be affordable in just a few years. This is especially true with medical treatment. Most medical care has doubled or tripled in the last five years. There are many people who have had their health insurance premiums double just in the last two years under the Affordable Care Act (ObamaCare).

You simply cannot count on the opposing party, the often irresponsible person who caused the accident, to have adequate coverage to protect you from such an injury or claim. Only YOU can do that for YOU. What is frightening is how utterly common this type of injury is.

In addition to obtaining the MOST UM/UIM coverage you can buy, there is another type of coverage that you should carry if at all possible. This coverage is called “umbrella” coverage. This is sort of “backstop” coverage, that covers you above and beyond your other normal existing coverages [such as homeowner’s, auto, etc.] if they prove inadequate. You can obtain umbrella coverage by normally having your homeowner’s (or renter’s policy) AND your auto policies with the same insurance company, in specified minimal amounts [usually $1 million each], and then they will sell you umbrella coverage in $1 million increments for a very reasonable sum; usually only a couple hundred dollars a year. Perhaps the most important and relevant use of umbrella coverage would be above and beyond your existing UM/UIM coverage. As such, if you had $1 million UM/UIM and then $1 million umbrella coverage, you would effectively have $2 million available to you for any accident, ABOVE AND BEYOND any coverage the person that hit you had. This is EXTREMELY good protection (and a bargain to boot) and would cover you for virtually any type of injury scenario.

This coverage, which goes above and beyond all existing coverages, is EXCELLENT coverage and especially so for the small amount of money charged. Umbrella coverage, in addition to healthy amounts of UM/UIM, is highly recommended. Further, this coverage is not only tied to your auto policies, but is a “backstop” coverage against your homeowners coverage as well, and will afford you excellent coverage for the money. This is coverage you should make every effort to obtain; as given the right accident/injury scenario, people have secured enough to never need to work again. A word of caution, however. Most insurance companies almost seem shy about offering or selling umbrella coverage, and you nearly always have to ASK about it, to find information about it and purchase it. Nevertheless, it is well worth doing and something that you should make every effort to do.

Sometimes, if you are making a claim against your insurance carrier and there is a dispute as to your coverage or whether it applies in the circumstances, your insurance company may write notifying you that they may be proceeding under a “reservation of rights.” (Meaning that they will provisionally cover the matter for now, but may later withdraw coverage after their legal counsel has a closer look at the circumstances) If they do this, frequently they provide you with your own separate, outside legal counsel [called “coverage counsel”] to advise you as to your rights in the situation. This is rare that a carrier would to this. Other than this limited situation, normally the above coverages are there to protect you in any home liability or automobile liability situations.