Worthington Law Group
Injury Law Report

U.S. insurance companies rake in billions of dollars in profits every year. How does the insurance industry make so much money? Unfortunately, many insurance companies engage in dirty tricks and unethical behavior to boost their profits. This includes the most well known and well respected. Some of their more common tactics can be referred to as the three Ds: delay, deny, and defend.

Delay

The first D is delay. A claim is made and the demands begin: You need to fill out a form, you did not fill out the form correctly, then you need to fill out another form. After that your claim is too late or your claim is not covered. It goes back and forth, back and forth. Meanwhile, the benefits that the insurer is supposed to pay out, remains in their pocket, inflating their profits.

Many people who suffer such TBIs do not receive appropriate treatment. The long term effects of a TBI can include many and varied symptoms, frequently related to brain function, such as seizures, headaches, dizziness, and problems with concentration and memory. TBIs can also cause other symptoms not commonly associated with the brain. This includes loss of motor control, fatigue, depression, speech disorders, anxiety, sexual dysfunction, and a short temper. Add an increased chance of getting lost or becoming agitated to the list.

Delay is an especially effective tactic with certain kinds of insurance like long term care insurance. The insurer knows that the illness affecting the person making the claim adds yet another obstacle to overcome before the person can collect the payment that he or she is due.

Deny

Most people think that the job of an insurance company is to pay covered claims. Not even close. In fact, insurance companies regularly refuse to pay claims that they know are covered. Many insurers actually reward the employees who pay the fewest claims and fire those who pay the most.

Claims are denied for any number of reasons, tenuous interpretations of policy language or willful misunderstanding of the facts. Sometimes they even engage in out and out fraud. In other cases, the insurer will “audit” the initial application for insurance and claim (frequently falsely) that it was not filled out properly. Or that the person did not disclose all of the facts he or she needed to disclose on the form. They will use either as an excuse to drop coverage entirely.

Denial of claims is effective because, as with delaying payment, many people will give up and drop the matter. Of course, every dollar not paid out on a claim is a dollar that goes back in the insurer’s pocket .

Defend

Finally, there is the third D; defend. If everything else fails, a person with a legitimate claim may have no choice but to force the insurer to defend itself in court. This all but ensures a delay of several more years while the issue is litigated, even more if the matter is appealed.

Some laws make it difficult to force an insurer to pay anything more than what should have been paid in the first place. This increases the incentive for the insurer to delay, deny, and defend.

So what should a person do when up against an unethical insurance company? All too often there is only one answer: Get a lawyer .

When you are pulling out the plastic to make a purchase, will it be a debit card or credit card? It makes sense to know how each one works, along with their respective advantages and disadvantages. The bottom line is that debit cards are fine for small and/or routine purchases, but credit cards, as a rule, are better for major purchases and online transactions because they offer more protections if something goes wrong.

Debit Cards

A debit card is like an electronic check—the consumer is spending money that he or she already has. As compared to credit cards, debit cards carry the potential for greater liability if the card is lost or stolen. Under federal law, liability is limited to $50 for the fast acting consumer who notifies the bank within two days after discovering an unauthorized transaction. After that, the cardholder could lose up to $500, or even more in some cases. On its own, a bank may choose to waive liability for unauthorized transactions if the consumer has taken reasonable precautions. Of course, this varies and depends on bank policies.

As a general rule, banks have up to 10 days to investigate transaction errors after receiving notice from the cardholder. Or, they have up to 45 days in special circumstances. Pending the outcome of the review, banks generally must credit the account for the amount of the alleged error.

As with credit cards, debit cards offer convenience and an alternative to carrying cash. But, unlike credit cards, the consumer is not taking on debt when using a debit card. Nor is the consumer paying interest or an assortment of fees, assuming the account is not overdrawn. It may even be possible to avoid the overdraft fees by linking a checking account to a savings account or a line of credit. A debit card can also be used to obtain cash without incurring charges that usually come with cash advances from using a credit card.

When there is a problem with purchased merchandise, there is no right to withhold payment if the consumer has used a debit card, which might be an option with a credit card transaction. Another drawback for debit cards is the practice of putting “holds” on funds. If the final amount is not yet known, a merchant may place a temporary hold on funds for more than is actually spent. This denies the consumer access to that amount until the hold is lifted later .

Credit Cards

Federal law limits a consumer’s losses to a maximum of $50 if a credit card is lost or stolen. It also provides protection against credit card billing errors. As opposed to debit cards, federal law may also allow the user of a credit card to withhold payment under certain circumstances until a problem with purchased merchandise is rectified.

The most commonly cited drawbacks for credit cards concern fees, interest rate increases, and penalties. In addition to annual fees for some cards, there are usually fees for late payments and for exceeding the credit limit. Of course, unless a consumer is in an interest free grace period, interest accumulates and adds to the overall debt, especially if the cardholder pays only the minimum amount due each month. As any credit card holder can tell you, having a credit card also makes overspending very easy, especially with high credit limits and enticements such as rewards programs.