Insurance Company Gets Taste of Own Medicine by Stupidest Insurance People in the World

March 6, 2007 by
Filed under: Collision Repair Industry 

This is hilarious. This is priceless. I was laughing so hard yesterday. I was laughing at the sheer stupidity of one insurance company, and the interesting predicament another insurance company found itself in.

In our sick twisted minds, at one time or another, we all have wished certain insurance companies could get a taste of their own bitter medicine; then, maybe, keel over an die. Relax, it’s just an expression. I don’t want anyone to die. Recently, one of those insurance companies did get a taste of it’s own medicine, and the adjuster was furious. He was furious and I was laughing like a mad man.

We’ve all experienced having our estimates revised by some yahoo in some other state who hasn’t even seen the car. These desk reviews are nothing more than a hatchet job with one purpose: To chisel your estimate down and save the insurance company money. They call these hatchet jobs “reviews” or “audits” but they are nothing more than financial rape. You could write all used and aftermarket parts, and a labor rate lower than what the insurance company is paying, and these estimate rapists would still find a way to come up with a lower figure.

I usually don’t negotiate with these people. I just tell them to send an appraiser. And I know a lot of you are now doing the same.

Yesterday, an appraiser I’ve known for decades was here doing a supplement, and when he finished he asked me to come out to his car. He was pissed off and wanted to show me something. At this particular insurance company the appraisers are also licensed adjusters so they handle the property damage part of the claim from start to finish.

This appraiser–we’ll call him Mike–wrote an estimate to replace the rear bumper on an insured’s vehicle. The person was rear ended but didn’t want to wait for the police report and all the hassles so he used his own insurance, paid the deductible and got his car fixed right away. His insurance company then subrogated the claim with MetLife. For the one person reading this who doesn’t know what subrogation is, it’s just a fancy name for one insurance company loaning another one money. Once it is determined that another insurance company was liable for the damages, the paying company sends a bill to the liable company and expects to get paid.

Now consider for a moment all the different insurance companies doing business in your state, and all of the accidents that happen. At any given time there are probably hundreds, if not thousands of claims going through the subrogation process. Allstate might owe State Farm for 30 claims and State Farm might owe Allstate for 25 claims. From what I’ve been told, it’s usually a pretty smooth process because there is an understanding that every company is going to be in a position where it owes another company money, and as long as State Farm doesn’t try to screw Allstate, Allstate won’t retaliate and screw State Farm right back. It’s like honor among thieves. Only the thieves aren’t quite as greedy and vicious as are these insurance companies. It’s this understanding that keeps everything going along smoothly.

Of course there are disagreements pertaining to liability, or percentage of liability, but that’s where arbitrators and the lawyers and the courts come in.

Mike was so pissed off because he had sent the subrogation paper work to MetLife for replacing a rear bumper and what he got in return left him speechless. MetLife sent him a letter back, because remember, he is the adjuster as well as the appraiser. In the letter the MetLife adjuster stated that at the time Mike wrote his estimate MetLife’s computer search showed that an aftermarket bumper cover was available from Keystone, therefore Mike should have written an aftermarket bumper cover. And because a counterfeit part was available, MetLife was sending reimbursement less the $127.00 difference in the aftermarket part. Apparently this had never happened to him. Apparently, around here anyway, this just wasn’t done.

To us, this is nothing new. We see this all the time. But Mike was beside himself. I was about to pee myself from laughing and told him to join the club. I asked him how it felt to have some dummy, who hadn’t even seen the vehicle, arbitrarily knock money off an estimate. Mike said, “How’s this moron even know that part was available. Just because it shows up in the database doesn’t mean it’s available.” I said, “Gee, that’s just what I say whenever you write some aftermarket part.”

Mike said, “It could have taken three days to get that aftermarket part. That’s three days more of rental. There’s the savings from the aftermarket part, and it just delayed the repair for nothing.”

I said, “Really now, I never thought about that.” with a sarcastic look on my face. I said, “Now you see what I have to go through every friggin’ day doing my job. How’s it feel?”

Mike can be somewhat of a hot head. He’s a great guy but he gets wound up easily. He started telling me how bad he was going to screw with this adjuster from MetLife. MetLife wants to be a cheap SOB, he’d show him what a cheap SOB really was.

MetLife had broken an unwritten rule. That rule makes a hell of a lot of sense. MetLife or Progressive or Allstate can do this all day long to body shops, but what are we going to do? We never get the opportunity to get them back doing the same thing. We never owe money to the insurance company. They don’t lend us money. We just don’t get involved in any two way transactions like insurers do with each other.

MetLife has to rely on Nationwide to reimburse them for monies paid to settle a claim and vice versa. It’s a codependent, if not dysfunctional relationship. There has to be trust and understanding. Imagine if every subrogation turned into a battle (yeah imagine that, huh? We have no idea what that’s like) and insurers started shorting each other. It would be chaos.

So the award for the stupidest insurance company, or more specifically, the stupidest insurance company employee goes to the goober from MetLife who raped Mike’s estimate. What a can of worms he opened up. And you know who suffers in the end? The customer who owned the vehicle and paid his deductible up front. This insurance company is not about to eat $127 just so their customer can get his entire deductible back. Nope, they’re going to pass their loss onto the customer. He’s going to get his deductible minus the $127.00.

With insurance company profits at record levels you would think insures would refrain from stirring up trouble by screwing each other. After all , aren’t they too busy screwing us? Maybe this adjuster was just trying to be a hero. I can’t imagine an insurer making it company policy to create situations where the pain of payback could outweigh the rewards of chiseling their fellow gangsters.

It will be great fun to watch insurers fighting each other for a change. Unfortunately, if this is a new trend, insurers will worry about getting fully reimbursed during subrogation. They’ll be thinking, “Hey, MetLife will only pay for aftermarket parts.” or “Allstate won’t pay the same labor rate as we do.” You-know-what runs downhill. Us simple folk livin down here in the valley better start filling those sandbags. It’s a comin!

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8 Comments on Insurance Company Gets Taste of Own Medicine by Stupidest Insurance People in the World

  1. Bob W on Tue, 6th Mar 2007 4:38 pm
  2. A taste of their own venom. Have a nice f#$%^^ day Mr. Adjuster. How sit feel to be in our daily ordeal???
    I would have loved to have video of that (I have video cameras everywhere!
    No honor amoungst thieves! ROTFLMAO

  3. Tommy on Tue, 6th Mar 2007 4:47 pm
  4. they’re going to pass their loss onto the customer. He’s going to get his deductible minus the $127.00.

    The insured is intitled to his entire deductable BEFORE his insurance company gets theirs.

  5. Richard on Tue, 6th Mar 2007 6:07 pm
  6. I think it is a simple matter of defining “Deductable”. Isn’t that when the insured pays the first $500 of the repair? If the insurance company isn’t going to refund the entire “deductable”,then it should not be labeled “Deductable”.. It should be listed as a percentage of the claim.

  7. charlie on Wed, 7th Mar 2007 6:29 am

  9. AG Silverman on Sun, 27th May 2007 5:51 pm
  10. Was this counterfeit part from Taiwan?? Did they get the counterfeit from Keystone or someone else.?? Does keystoneprovide assurance that it is not a counterfeit..they have been in the press saying they dont counterfeit but does any body have fcats and eveidence that Keytsone substituse these parts..maybe the vehicle owner and the bodyshop is getting ripped off–does the insurers care…?? isit a safety part maybe somebody should care—-likr the insurance commission

  11. John Jorges on Tue, 29th May 2007 7:14 am
  12. These companies work under the illusion of ‘saving the insured money’. Progressive came to my shop and wrote a RECONDITIONED (yes, reconditioned) fender, grille and front cover for an ’05 Elantra. These parts were ‘found’ at Keystone. They arrived in wrappers that said, “made in Taiwan”. What a surprise! The joke was that the ‘recon’ grille was actually a few dollars MORE than OEM, and didn’t come with the emblem as it’s copyright blah blah.
    I actually wrote and RECEIVED a $28.00 supplement from these fraud perpetrators.
    When I questioned the $43 rate across the board, I asked for several, non-DRP’s in the area that work for this reduced amount. Lori, the super gave me the name of a shop in Teaneck, West New York, and Atlantic City. We’re located in Linden, NJ. Anybody got a map?
    She told me that’s my area because they handle all these shops from the Iselin office. Wowie! What logic!!!!!!

  13. Mike on Thu, 31st May 2007 2:19 pm
  14. This is a total bunch of crap. First of all, this “appraiser/adjuster” would totally understand another company doing their own research for the repair……second, I say 80% or more of the subro. demands that I see and handle do not come up to the total amount requested from the other company. Who cares? The fact that you think inurers have this little “understanding” is crazy. No insurer gives the other insurer any favors…’s called competition, and if anything, they are harder on the subrogation demand than they are on a body shop because of this. Just another viewpoint of a disgruntled body shop employee here.

  15. McF on Fri, 22nd Jun 2007 2:26 pm
  16. “This insurance company is not about to eat $127 just so their customer can get his entire deductible back. Nope, they’re going to pass their loss onto the customer. He’s going to get his deductible minus the $127.00.”

    I’ve been a claims adjuster for 20 years and can assure you that if ANY
    of the deductible is returned, ALL of it is going to be returned. The insurer
    is not going to leave their insured in the middle of a fray between them and
    another company. You are obviously uneducated in the ways of subrogation
    and should consider the source of a body shop’s income – if
    they do any business at all their income is derived from insurance payments,
    not car owners.
    it is the insurance companies

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