More Fun with Connecticut?s Insurance Department

February 23, 2004 by
Filed under: Uncategorized 

If you?re ever bored and you want something useless to do, you know, just to pass the time, and you want to hasten your turn in line at the pearly gates via a high blood pressure induced stroke, try to get your state?s insurance department to discipline an insurance company. It?s a Kevorkian?s dream.

I?ve had my share of problems getting Connecticut?s Insurance Department to act in the past. You would think I?d learned my lesson, wouldn?t you? And that?s exactly what the Insurance Department, and the insurance companies bet on. But they don?t usually run across someone like me with so much time and so little to do. After licking and healing my wounds from the last battle (see the story about Allstate) I was ready to get my ass kicked again.

It started last November when AIG sent one of their finest to inspect a Saab with some minor tree damage to the roof. Normally, the guy I deal with from AIG is outstanding. We never have problems. But AIG recently made some internal changes, moved some people around (I guess they didn?t like that I actually liked their appraiser) and I ended up having to deal with someone I?d never met before. I had heard many wonderful things about him from other shops, but I never had the pleasure myself of being graced with his charming personality and generosity.

I could write a whole story just on his visit, but let me just say I knew I was in for a life altering experience the moment he walked through the door. The first thing that came to mind is that this poor fool must have just been caught making nice-nice to his pillow by his mother. He was miserable. And first impressions weren?t wrong.

He didn?t want to pay for anything. He didn?t want to pay my labor rate. He spent 20 minutes in the parking lot trying to fix the car himself. Fearing he had some contagious affliction, I just walked away. He left without an agreed price to repair the car.

I called the appraiser?s boss, but my chances were better with the appraiser. Maybe it was the boss who caught the appraiser making nice-nice to his pillow. Whatever the reason, the boss was more miserable that the appraiser. I had heard rumor of this by other shop owners, but I just dismissed it as gossip, because I had always enjoyed a great relationship with AIG.

After a full hour of dealing with AIG?s psych ward patients, I sat down and crafted a finely worded complaint to our helpful State Insurance Department. Using their official complaint form, which was designed and printed by the state?s own psych ward patients, I detailed my experience with AIG?s appraiser, his boss, their refusal to negotiate the claim, and their attempt at repairing the vehicle themselves in the parking lot. I promptly mailed the complaint and waited a response.

A month later I received a response from the Connecticut Insurance Department. ?Mr. Shortell, blah blah blah, the Insurance Department doesn?t set rates (they always say this even if I complain about something that has nothing to do with rates), blah blah blah, our research shows that many insurance companies conduct their own surveys (your research is about as good as the insurance companies? surveys), blah blah blah, you have the right to set your rates??.blah blah blah, enclosed is the reply from AIG, many more blah?s?.?

AIG?s letter of response was incredible. They admited to breaking the law, and then lied about how they did it. This is bad enough, but they did this defending the behavior I complained about. AIG wrote, ?Mr. [appraiser] offered the insured three other repair shops [shops A, B, and C] all located in the same area. These repair facilities agreed to repair the vehicle for $42 per hour.?

Because I?ve had experience with being lied to by insurance adjusters about other shops agreeing to repair cars at lower labor rates, I called each shop listed in AIG?s letter. One shop received a called, but he refused to work for $42. The other two shops told me that they spoke with no one from AIG. So, by the statements of these three shops, AIG lied to the Connecticut Insurance Department. But what they lied about was illegal in the first place.

Connecticut statute 38a-790-5 states,

?If the appraiser and the repair shop fail to agree on a price for repairs, the appraiser shall not obtain a competitive estimate from another repair shop unless the owner of such other shop, or his authorized agent, has inspected the vehicle. No such competitive estimates shall be obtained by the use of photographs, telephone calls or in any manner other than a personal inspection.?

AIG told the Insurance Department in their response letter that they obtained an agreed price with three other shops over the phone, without anyone from these shops inspecting the vehicle. It?s right there in writing! They admit it! But they didn?t really do it. So they lied about breaking the law! How stupid is that?

Now you could debate the nuances of this statute and AIG?s statement until an honest politician was found, or until insurance companies started paying fair labor rates, but that misses the point. The point is intent. And it appears that AIG?s intent here was to weasel its way out of taking responsibility for engaging in unfair claims practices. Their statement that they obtained agreed prices with other shops over the phone leaves them in a precarious position. To not be guilty of violating statute 38a-790-5, they have to admit to lying to the Connecticut State Insurance Department. I do believe that is illegal. To stand by their statement, and insist they did not lie, they have to admit violating statute 38a-790-5. That?s kind of like having a choice between Allstate and Progressive.

I quickly typed up a response to AIG?s response, outlining the lies and the lying liars who told them (sorry Al, but it?s the only good thing that ever came from that blank mind of yours, and I?m using it), and sent it out.

After a month, I still heard nothing. I called to speak with the associate examiner at the Insurance Department to find out the status, and what they were going to do to AIG for their behavior. She told me she never received it. This is strange, because not only did I send the letter to her, but I faxed it also. Documents seem to get lost between my shop and the Connecticut State Insurance Department quite often. It must be some unexplained phenomenon, like the Bermuda Triangle. Yeah, that?s it!

I resent, and refaxed my response letter, but this time I also sent and faxed a copy to her boss.

Two weeks later I received another letter from the Insurance Department associate examiner. It?s unbelievable. Scratch that. It?s totally believable. AIG responded to my accusation that they lied to the insurance department, and, basically, told the insurance department they didn?t do anything wrong. So the insurance department writes to me that AIG didn?t do anything wrong and there is no further action to be taken. Well, isn?t that special. I wish I had that kind of relationship with the state. I could rob a bank, write a letter to the attorney general, tell him I did nothing wrong, and just like that, a get-out-of-jail-free card. Really nice. Thanks for spending my tax dollars wisely. And thanks for keeping the already too powerful insurance industry in check.

I called this?..ahem?..examiner and asked for an explanation. Maybe she would be more suited examining?oh?.let?s see??sphincters? Sorry, anyway, she repeated her mantra, ?We don?t set labor rates.? I started to explain to her that this had nothing to do with labor rates, but she kept telling me to take AIG to court. In other words, ?Screw off, these are my buddies you are harassing, and I won?t help you do it!? Finally I stopped her, ?Let me talk to your boss.?

I told him the whole story and he promised to look into it. Meanwhile, the Connecticut Attorney General now has a nice fat manila envelope filled with various interesting documents, letters, surveys, statutes (just in case he forgot what they say), etc.

I wonder if he worked for an insurance company before being elected to Attorney General?

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Comments

3 Comments on More Fun with Connecticut?s Insurance Department

  1. David Roper on Thu, 26th Feb 2004 6:45 pm
  2. Very true. I have been in the collission business for thirty years, and nothing has gotten any better in this area.
    Keep me posted with new columns, you are hitting the nail on the head. The only way to stop this is a FEDERAL regulatory agency and an end to the revolving door between industry and state agencies.
    Dave Roper, Dave43241@Yahoo.com.
    P.S. I was a bodyman at Hoffman Olds and Rolls Royce in East Hartford In 73-74. Good luck in the good fight. Dave

  3. who needs the ins. company on Wed, 24th Mar 2004 7:59 pm
  4. Never deal with a Ins. Carrier. I have not dealt with these people in over 35 years. WHY? They would not pay my labor rate. I must admit my labor rate is much higher then the standard auto repair shop but I do not use bondo, only lead. When I quote a price for painting the complete auto, this includes ALL of my materials. I generally have a lot of materials to but as I disassemble the auto and put on NEW bolts,nuts,weatherstripping,gaskets

  5. who needs the ins. company on Wed, 24th Mar 2004 7:59 pm
  6. Never deal with a Ins. Carrier. I have not dealt with these people in over 35 years. WHY? They would not pay my labor rate. I must admit my labor rate is much higher then the standard auto repair shop but I do not use bondo, only lead. When I quote a price for painting the complete auto, this includes ALL of my materials. I generally have a lot of materials to but as I disassemble the auto and put on NEW bolts,nuts,weatherstripping,gaskets

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