Recent Allstate Commercial

Posted: Fri Oct 31, 2008 11:39 am Post Subject:

I'm so glad we are 'good boys and girls' and investigator isn't going to come for us! :shock: However, how I would love, love love to be involved in the bust....mmmmmmmmmmm.mmmmm....sweet sweet karma...

Posted: Fri Oct 31, 2008 03:40 pm Post Subject:

Lori, I've often said (and proven) that I can go to any town, in any state, at any time, and find insurance fraud. Present company acknowledged - all I claimed I'd ever have to do was open the phone book and look for an Allstate agency. Maybe we'll have to get together one of these times and I'll show you just how easy it really is.

Posted: Fri Oct 31, 2008 04:58 pm Post Subject:

I don't doubt it...I'd say without question that a good 25% of the claims I handle have 'some type' of fraud...now as to agents commiting fraud, I don't have a clue...I have been involved in busting a couple years ago but nothing other than a slap on the wrist and a forced e and o policy claim ever came from them.

Posted: Fri Oct 31, 2008 06:04 pm Post Subject:

Lori,

This was one of my better cases of "karma".


Press Release

Welcome to the California Department of Insurance's Media Relations webpage.
If you are a member of the public wishing information, please visit the Consumer Services Division homepage or call the Consumer Hotline.
FOR RELEASE:
December 6, 2000 (#115)

CALIFORNIA DEPARTMENT OF INSURANCE FILES ACCUSATION
WITH INTENT TO REVOKE LICENSE OF INSURANCE AGENT

SACRAMENTO – The California Department of Insurance (CDI) has filed an "Accusation" with the intent to revoke the license of a Fremont, California insurance agent. The Accusation will be heard before the Administrative Law Bureau.
Alan L. Cerf, 51, a subject included in a front-page expose by the
San Francisco Chronicle in September of 1998, began his career as an insurance agent in 1973. From 1979 to 1997, Cerf was employed as an insurance agent with five different insurance companies. With each new employer, Cerf would allegedly initiate a massive rollover of his clients from their existing policies to similar policies with his new employer. Despite the inherent cost to the policyholders associated with such rollovers, Cerf was able to draw on the trust he was given as a licensed insurance agent.
According to Investigators from CDI Criminal Investigations Branch, Cerf rolled over more than 700 policyholders. Conversely, some policyholders lost money through surrender fees and lost benefits, while Cerf made large commissions on the new policies. According to CDI Investigators, the commissions in some cases were equal to approximately 100% of the premium for the first year of coverage.
CDI Investigators found that in 1992 Cerf began the process of rolling over policyholders from Central Life Insurance to Pacific Mutual Insurance. The vast majority of these policyholders incurred large surrender fees and most of them received policies with lower benefits. In some of these "rollovers", victims incurred surrender fees between $6,000 and $8,000.
According to CDI Investigators, another damaging aspect of policy "rollovers" is the two-year contestability period clause contained in policies. These clauses allow for a death claim to be challenged within the first two years of a policy if the cause of death was related to an undisclosed medical condition which may have existed at the time the policy was written. People who begin to experience severe maladies are not only charged with a higher rate, but they face the possibility of having their claims denied if their death occurs within the first two years of the policy. Under no circumstances would a person with such a condition be advised to change from a permanent life policy to any other type of policy, especially if the new policies were at higher rates and lower benefits levels. However, in at least two cases reviewed, policyholders were afflicted with life threatening medical conditions, with one client declared uninsurable for a period of two years. During that two-year period, this particular client was unknowingly uninsured, and his premiums were being diverted to his wife's policy, without their knowledge.
CDI Investigators also discovered at least three cases in which policyholders received highly surcharged term policies, in which the premium would increase significantly after the initial period. In one case, a policy was surcharged at 200% and his premium was scheduled to escalate each year. The initial premium was set at $1,215 for the first year, but by the tenth year his premium would be $10,500 a year, for a policy with a benefit level of only $125,000. According to CDI Investigators, the victim was unaware of the policy structure because the policy delivered by Cerf did not contain the premium page. Upon close inspection of the policy, it was found that the policy had been disassembled and stapled back together minus the premium page. This same scheme was found in at least two other cases.

Posted: Fri Oct 31, 2008 06:39 pm Post Subject:

Wow...We need to clean up more scum like this. It irritates me when going to conventions or general sales courses and such to talk to other agents that only care about the bottom dollar. I am not really making all that much money...enough to support and have extra obviously but I am more concerned with my customers knowing what they are buying and making sure it is the best for them.

Posted: Fri Oct 31, 2008 06:40 pm Post Subject:

Dayum.....

(if you get to Memphis, I'll give you a couple of addresses)

Posted: Fri Oct 31, 2008 08:50 pm Post Subject:

We have to be fair to LifeIsGood.

Allstate has been thrown under the bus and driven over in this thread.

It's NOT the Allstate "agents" who refuse to pay the fair claims.
It's NOT the Allstate "agents" who refuse to write homeowner's in Florida.
It's NOT the Allstate "agents" who set their rates, deny claims and cancel policies.

Now I'm NOT a Properly & Casually guy but the story I got regarding Allstate being aggressive bass towards when it comes to auto claims is that they made a corporate decision (some years back) they were not going to just pay out these $10,000 to $20,000 fraudulent auto claims because of the threat of litigation costing more than the claim.

They wanted to send a message to the ambulance chasing attorneys that Allstate wasn't just going to write an easy check anymore.

Posted: Fri Oct 31, 2008 08:58 pm Post Subject:

Thanks for that Gary - it just happened to be Allstate because of our excellent commercial (hee hee). I'm sure we could start a thread about any number of companies and have the same conversations.

You are right - Insurance companies are good targets for a certain type of lawyer. We have all heard where it is easier/cheaper to pay than it is to take the case to court.

Allstate said enough. I'm glad they did. Keeps my loss ratio in check.

Posted: Sat Nov 01, 2008 03:14 am Post Subject:

Trick - or- Treat
I agree, let's leave Allstate alone and pick on somebody else. I think we should pick on those ruthless SOBs at Americo.

Here comes the bus:

Americo's Vanishing Premium Sales Scheme

Americo encouraged and trained its agents to market life-insurance using “vanishing premium” sales presentations. The “vanishing premium” concept refers to marketing life insurance policies on the basis that after a certain number of years, or after one lump sum premium payment, a policy's premiums can be completely paid by interest (in the case of an Interest Sensitive Whole Life Policy). As a result, policyholders are told they need only pay premiums for certain number of years (usually between 5 and 10), and once the “vanish year” is reached, no further premium payments will ever be required from the policyholder.

As part of the sales scheme and conspiracy, Americo supplied its agents with illustrations (or the computer software designed to produce such illustrations) for use in vanishing premium sales presentations. These illustrations were intended to induce potential policyholders into purchasing Interest Sensitive Whole Life Policies on the basis that after a certain number of years, no further premium payments would be required from the policyholder to keep the policy in force. The illustrations contained a column representing the annual premium payments required by the policy. The illustrations represented that once the “vanish year” was reached, no further premium was required from the policyholder.

Americo's vanishing premium illustrations projected policy values and premium payments based on the unrealistic premise that the interest rates, mortality and expense assumptions and other assumptions used in the illustration – which were not disclosed anywhere – would continue unchanged for the duration of the policy, a period often extending 20 or 30 years into the future. Thus, if Americo credits less interest during the life of the policy than illustrated, the policy will not accumulate sufficient interest to pay the policy's future premiums and the cash premiums will not vanish as illustrated.

Americo omitted this material information and its illustrations and representations made to policyholders. Americo knew, but failed to disclose that its interest crediting rates would be reduced in the future, thus requiring policyholders to make several years of additional premium payments beyond the represented vanish year in order to keep their policies in force.

Posted: Sat Nov 01, 2008 12:23 pm Post Subject:

So Mark what happen to the guy in CA?