The Attorneys’ Guide To The Best Auto Insurance Companies

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Introduction

Insurance companies don’t always do what they’re supposed to do. Especially in a state like Michigan.

Why is there so much insurance company abuse? Because when rules that are meant to protect the public are not enforced or even do not exist, abuse becomes more likely. Michigan is a good example. It is one of only five states that has no punitive damages laws.

It has an extremely weak bad faith law. And Michigan has a Consumer Protection Act that insurance attorneys cannot use to protect people against insurance companies who ignore and avoid paying on legitimate claims. Imagine - a Consumer Protection Act that can’t be used to protect consumers from insurance companies!

Without these protections, people in Michigan are treated far worse by insurance companies than people are treated in most other states.

I should know. For the past several years, I’ve served as President of the Motor Vehicle Trial Lawyers Association. I have travelled and spoken at seminars with other insurance attorneys all over the United States. I also previously served as the President of the American Association for Justice Truck Accident Lawyer Group, where again, I’ve worked with lawyers all over the country on serious truck accident cases.

But not all insurance companies are bad. In fact, some insurance companies are actually quite good, give or take a particularly nasty claims adjusters here or there.

Larry Gursten and Steve Gursten outside of Michigan Auto Law offices.

This guide is based upon the experience and actual cases of the insurance lawyers at Michigan Auto Law. With 17 attorneys who only help people injured in automobile accidents, our attorneys deal with the insurance companies every single day. We know from real, hard-won experience how some insurance companies really treat their customers, because these customers become our clients when an insurance company breaks its promises, and because we help people collect No Fault insurance benefits after auto accidents.

Sadly, reality doesn’t always match what we see on the television commercials: You are not in “Good Hands” with Allstate and State Farm rarely acts like a “Good Neighbor.”

If you have questions about your auto insurance rights, I hope you won’t hesitate to call us.

Sincerely,
Steven M. Gursten

Real Clients, Real Stories

The Michigan Auto Law team.

Helping people with dignity, respect and care

“Michigan’s largest law firm completely specializing in serious automobile accidents.”
— Michigan Lawyers Weekly

Find testimonials from real Michigan Auto Law clients from your own city in Michigan, here.

My auto attorney Steve Gursten is absolutely wonderful. I was actually referred to him from another law firm. He is caring and very prompt with responding to any concerns that I may have had. He actually makes you feel as if you are his only client. He is very aggressive and knows his stuff; and talks with you in understanding terms (instead of the legal mumble jumbo). I actually call him for any legal questions that may arise - even not car accident related - and he takes the time to help. I would recommend anyone at anytime to Steve Gursten and Michigan Auto Law.
— BB Rosson, Detroit
I was treated like family here! Michigan Auto Law is the greatest. They’re like family and they’re so helpful. I've never met anybody so pleasant, the whole entire firm. Lawyers Kevin Seiferheld, Amy Gubesch, everybody. They took such good care of me. I would tell anybody I know that was in an accident to come right here.”
— Claudia Pinson, Ecorse
Everything you need is all taken care of at Michigan Auto Law. A very difficult process was made very clear and easy thanks to my attorney Mike Shaffer. Recovering from my car crash was a lot. It was emotionally taxing, there was physical trauma. Mike understood us from the emotional and legal standpoint. He was very sensitive and protective. I highly recommend this firm. Everyone from the secretaries, the paralegals and the lawyers did perfect work from start to finish. They were a joy to work with.”
— E.K., Grand Rapids
“I was in a head-on collision on M-37 in Grand Rapids and sustained a head injury, a traumatic brain injury, neck, disc and muscular injuries. I turned to Michigan Auto Law when my auto insurance company refused to pay my benefits. The lawyers at Michigan Auto Law were fantastic. Their knowledge of law brought us to what I consider a very good situation — getting our medical benefits covered and a great settlement.
— Dan Johnston, Grand Rapids
What really mattered to me was that Michigan Auto Law paved the way for others when they won my case. They set a precedent that big corporations cannot put a price on someone’s life. I lost 4 years of my memory-life, which was catastrophic for my whole family. My son was only 3 ½ when the accident occurred and I still can’t watch the videos of his first years that have been stripped from my mind. Now, other victims and their families can reference my case.”
— Angela Fini, Milford
I was overwhelmed with my settlement. It was way more than expected. Even my former attorney was surprised by the settlement. Steve Gursten always made me feel like a priority - even calling me on Sundays. I recommend Steve highly. He’s a very nice guy, down to earth and a very caring person that works hard for you.”
— Rhonda Searfoss, Gladwin
When Larry took over my case, it wasn’t cut and dry and he took a risk at the beginning. I wasn’t sure how it would go, but we settled for more than we thought. I am very pleased with how Larry and the other attorneys handled everything. They were always responsive to my calls and questions, and I really felt as though we were a team.”
— Mike Constantini, Fenton
Larry Gursten handled a case for my husband for his closed head injury. He is so understanding and compassionate. He was very understanding of the problems that myself and my children were going through after the accident and during my husband’s medical treatment. He always returned all telephone calls and he made an amazing settlement for my husband, myself and for our children. I would highly recommend Larry to anyone seriously injured in an auto accident.”
— Kelly Saldana, Brownstown
“When someone I love was hurt in a car accident I wanted the best auto attorney I could find. So I did my research. Michigan Auto Law’s impressive reputation and results brought me to their door. Not only was my perception of their legal talent right on point, but to that ability they combine good intentions, empathy, people-skills and professionalism. Michigan Auto Law is at the top of their specialty.
— John Wilcox, Attorney, Lansing
Chapter 1

Top 4 Best Auto Insurance Companies

There are a lot of lists out there. My list is different. For nearly 20 years, I have sued almost every insurance company in America. I am an insurance attorney who has spent his entire career helping people who have been seriously injured in automobile accidents. I work in a law firm of eighteen attorneys who only help people injured in automobile accidents, and I am the current president of the Motor Vehicle Trial Lawyers Association.

So my own list includes something that other lists do not: how do these insurance companies actually treat people when someone is really hurt? How do these insurance companies act when someone needs to make a claim?

I should add, of course, that when people find out I am an insurance attorney, I am asked constantly what insurance companies do I think are good, what insurance companies do I think are bad, and are there any insurance companies that I would actually recommend.

So I put together a list of the automobile insurance companies that my fellow insurance attorneys at Michigan Auto Law and I have identified as the insurance companies we believe are best. And we put together another list of the insurance companies that I personally consider the worst insurance companies.

The insurance companies on my "best" list tend to treat people fairly and pay claims promptly. The ones on my worst list do not, based upon the actual experiences I have had with them, and based upon the people we represent and help every year. The companies on my "best" list also give people the best value for their auto insurance premium dollars.

These lists are the product of my own actual experience as an insurance lawyer, as well as the legal experiences of the eighteen attorneys in my office who see and litigate cases with these insurance companies every single day. We have seen a lot of broken promises, destroyed lives, and bad faith over the years.

Some insurance companies with lower prices got dropped off my lists because of how I see them treat the people who become my clients. For those readers from Michigan, one such example is Farm Bureau General Insurance Company of Michigan (and Farm Bureau Mutual Insurance Company of Michigan). Even though Farm Bureau has low prices, my own experiences with how Farm Bureau treats people (along with the experiences of the other 17 insurance attorneys here) has shown that Farm Bureau treats our clients poorly when they're injured and most in need of insurance benefits. Moreover, Farm Bureau has intentionally written extremely restrictive language into its "Underinsured Motorist" (UIM) policies that make it very hard to get the insurance benefits that it promises to people.

How did I comprise my list of the best and worst insurance companies?

The list of the "Best Auto Insurance Companies" is comprised of insurance companies that have the best:

  • Price.
  • Track record for paying accident/injury claims.
  • Consumer complaint history.
  • Customer satisfaction.

With these factors in mind, I evaluated the top 10 largest auto insurance companies here in Michigan, as well as dozens of other auto insurers, to see what they had to offer. For those readers from other states, the information here is still a good overall guide, but may vary somewhat from state to state.

Based on my analysis, the insurers who made my list of the Best Auto Insurance Companies for 2013 are:

  • Auto-Owners Insurance Company
  • Home-Owners Insurance Company
  • Michigan Millers Mutual Insurance Company
  • Grange Insurance Company of Michigan

Plus, I have a "Quick Tip" to help everyone find the "Best" auto insurance company:

  • Talk to an Independent Insurance Agent

Below are my reasons for including each auto insurer on my list and for my "Quick Tip."

I encourage you to tell me what you think of the list by visiting the Michigan Auto Law "Forum," at www.michiganautolaw.com/forum. Do you agree with the insurers on the list? Would you add any names? Are there any insurers that you strongly feel don't belong on the best insurance companies list, or that deserve to be on the worst insurance companies list?

Auto-Owners Insurance Company

For the past five years, Auto-Owners Insurance Company has won the J.D. Power and Associates U.S. Auto Claims Satisfaction Study (2008-2012), ranking "highest in providing a satisfying claims experience for auto insurance customers …" Each year, Auto-Owners earned the highly coveted rating, "Among the best."

Additionally, for the past three years, Auto-Owners has ranked "Better than most" in the J.D. Power and Associates U.S. National Auto Insurance Study (2009-2011), which measures customer satisfaction with auto insurance companies.

Similarly, in Consumer Reports Magazine's 2010 Car Insurance Ratings survey, Auto-Owners Insurance received the fourth highest "Reader Score" rating for "overall satisfaction with claims handling." And, for timeliness of claims payments, Auto-Owners received the highest rating, "Better," and favorable ratings for the insurer's handling of claims-related and non-claims-related problems.

Among Michigan's largest auto insurers, Auto-Owners topped the list for paying out the highest percentage of its premium dollars in claims for its auto-insurance customers. For instance, for every premium dollar Auto-Owners receives from Michigan drivers, it pays out approximately $.74 in auto accident claims submitted by its auto-insurance customers.

Similarly, when compared with Michigan's other largest auto insurers, Auto-Owners' prices were among the Top 5 least expensive in 15 of the 16 major Michigan markets examined in compiling the "Best Auto Insurance Companies" list.

Finally, not only has Auto-Owners received relatively few consumer complaints annually, but it was one of the least-complained-about insurers among Michigan's largest auto insurance companies four out of the last five years.

Home-Owners Insurance Company

Among Michigan's largest auto insurers, Home-Owners's prices were among the Top 5 least expensive auto insurance rates in all 16 of the major Michigan markets examined in compiling the "Best Auto Insurance Companies" list.

Additionally, when compared with Michigan's other largest auto insurers, Home-Owners paid out the second highest percentage of premium dollars in claims for its auto-insurance customers. For every premium dollar Home-Owners received from drivers, it paid out $.69 in auto accident claims submitted by its auto-insurance customers.

I don't litigate very many cases with Home-Owners Insurance Company. I do litigate a lot of cases with insurance companies that are of similar size to Home-Owners Insurance Company.

There is a reason for that.

Grange Insurance

Grange Insurance has been one of my personal favorites for the last couple years. The claims adjusters seem to try to do the right thing. For instance, one of my co-workers had a drunk driver slam into her husband's pick-up truck that was parked in the street in front of their house in the early morning hours. Even though they had a substantial deductible, the Grange adjuster waived it.

Significantly, Grange Insurance Company of Michigan has consistently for the last five years received relatively few consumer complaints.

Indeed, Grange Insurance has received favorably ratings each of the last three years in the J.D. Power and Associates U.S National Auto Insurance Study (2009-2011).

Michigan Millers Mutual Insurance Company

Michigan Millers Mutual has consistently been one of the least-complained-about auto insurers in Michigan for the last five years.

QUICK TIP: Talk to an Independent Insurance Agent

Want to find the "Best" auto insurance company for you and your family, at the best price?

Here's a quick tip: talk to an Independent Insurance Agent. Independent insurance agents are great resources because they can quote insurance coverage from many companies at once to find the best price. They are not "captive" agents of one company only. They can collect and compare information from a wide array of auto insurers.

Unlike independent insurance agents, who work with many national and Michigan-based insurers, an agent who works for one specific insurance company can only sell you on that company's insurance, regardless of whether it's the most appropriate, the most comprehensive or the best value.

When you speak with an Independent Insurance Agent, explain that you want to buy Michigan auto insurance and you'd like quotes from multiple companies. The coverage you will want quotes for include: Michigan mandatory No Fault; broad-form, standard and limited collision; uninsured motorist; underinsured motorist; and umbrella.

Sources:

  1. Insurance Institute of Michigan, 2010 and 2012 IIM Fact Book, "Top Writers of Auto Insurance in Michigan." (Page 27)
  2. "2008 Buyers' Guide to Auto Insurance," Michigan Office of Financial and Insurance Regulation (OFIR)(Example 3: Pages 16-17).
  3. "The Competitiveness and Premium Excessiveness of the … Auto Insurance Industr[y] in the State of Michigan," Michigan Office of Financial and Insurance Services (OFIS)[Now known as the Michigan Office of Financial and Insurance Regulation (OFIR)]("Appendix L: Auto Insurance Companies' Combined Loss Ratios …")
  4. "Insurance Company Complaint Ratios" ("Coverage Type: Automobile") for 2007 through 2011, Michigan Office of Financial and Insurance Regulation (OFIR).
  5. J.D. Power & Associates 2012 U.S. Auto Claims Satisfaction Study; J.D. Power & Associates 2011 U.S. Auto Claims Satisfaction Study; J.D. Power & Associates 2010 U.S. Auto Claims Satisfaction Study; and J.D. Power & Associates 2009 U.S. Auto Claims Satisfaction Study.
  6. J.D. Power & Associates 2011 U.S. National Auto Insurance Study; J.D. Power & Associates 2010 U.S. National Auto Insurance Study; J.D. Power & Associates 2009 U.S. National Auto Insurance Study.
  7. Consumer Reports Magazine, 2010 October, Car Insurance Ratings survey.
Chapter 2

Auto Insurance Company Tactics

Let's face it: many auto insurance companies make money by not paying on claims.

As insurance lawyers helping people injured in car accidents and truck accidents, we see it all.

In fact, accident victims are limping away from hundreds of millions of dollars in valid and deserving claims that insurance companies are required to pay every year, but don't.

Many of these auto insurance companies believe you won't wait, you won't hire an insurance lawyer to file a lawsuit, and you will eventually become so fed up that you'll take a low-ball settlement offer.

There even is a name for this. It's called the “3 D” strategy: delay, deny and defend. Some insurance companies have claims models set up to delay your claim, deny you were hurt and defend aggressively.

Read on for our list of the worst auto insurance companies. Some of these auto insurance companies are the worst offenders of the "3 Ds" and several other anti-consumer tactics.

Chapter 3

Worst Auto Insurance Companies: OVERVIEW

Here’s my personal overview of Worst Auto Insurance Companies. Our own attorneys put this list together based upon what we see every day from actual cases with actual clients. Our collective experience in helping people who are forced to sue for insurance benefits over the years has led us to name these auto insurers as our pick for the worst of the bunch.

1. State Farm Insurance ‘Repeat Offender for Abusing Auto Accident Victims’ Award

State Farm Mutual Automobile Insurance Company is the No. 1 provider of auto insurance in the country. Profits for State Farm Mutual Automobile Insurance Company increased by nearly 100% from $570 million in 2009 to nearly $1.1 billion in 2011, according to its Annual Reports to policyholders.

We don't begrudge State Farm for making a profit. But Michigan Auto Law's insurance attorneys do blame State Farm for overcharging drivers (in Michigan, our drivers pay some of the highest insurance premiums in the entire country).

When compared to Michigan's other largest auto insurers, State Farm Mutual Automobile Insurance Company's auto insurance rates were among the Top 5 most expensive in all 16 of the major Michigan markets examined in compiling the "Worst Auto Insurance Companies" list.

Our insurance attorneys can also say from our own first-hand experience that State Farm is now the most aggressive in accusing its own customers of fraud, putting them under "investigation," and fighting payment of insurance benefits.

And, how well does State Farm protect its own customers when they need the insurance giant to defend them if they've caused a serious car accident?

Consider a recent case that our attorneys Kevin Seiferheld and Josh Terebelo had in November 2012 with Hannosh v. Varadi, et al., where State Farm insisted that a rear-end accident victim's disc herniation and spinal surgery was not related to the automobile accident. State Farm took the case to trial, forcing the case to trial by literally offering $0 to settle the case (that's 0 - as in not a penny to protect its insured, even though an experienced panel of personal injury lawyers had evaluated the case as being very serious and substantial).

Fortunately, a jury returned a $1.485 million verdict in favor of the innocent accident victim.

This is not the first time that our attorneys have seen State Farm force its own customers to trial, and recklessly exposing their own personal assets (makes you wonder why people buy insurance, doesn't it?).

For instance, in a Washtenaw County case where a jury ultimately returned a $2 million verdict in favor of the auto accident victim who had suffered a traumatic brain injury, State Farm forced the case to trial by offering $0 to settle the case (sense a theme?).

Michigan drivers have also had a lot to say about State Farm. Every year for the last five years, State Farm Mutual Automobile Insurance Company has been THE most-complained-about auto insurer among the nearly 80 auto insurance companies doing business in Michigan.

2. Allstate Insurance Company ‘Repeat Offender for Abusing Auto Accident Victims’ Award

Allstate doesn't seem to have any problem growing its bottom line, but what I don't like is how they do it:1 Boosting profits by paying out less on its customers' claims. Documents made public in 2008 describe a two-pronged strategy: Allstate evaluates claims with a computer program designed to reduce auto accident claims payouts, and it pressures injured auto accident victims to accept and agree to very low settlement offers.

Significantly, Allstate was eventually held accountable for its use of the computer software to reduce its auto accident payouts. Allstate entered into an agreement with insurance commissioners across the country whereby Allstate promised to:

  • Notify auto accident victims and their lawyers when Colossus claims software is being used to adjust their personal injury claims.
  • Stop rewarding its insurance claims adjusters for settling car accident claims for the amounts specified by the Colossus computer program.
  • Pay $10 million to train insurance commissioner personnel to monitor and evaluate Allstate's continued use of Colossus.

http://www.michiganautolaw.com/auto-lawyers-blog/2011/03/24/allstate-confesses-to-using-computer-program-to-reduce-settlements-for-auto-accident-victims-in-michigan/

http://www.michiganautolaw.com/auto-lawyers-blog/2011/04/06/allstates-agreement-to-change-its-use-of-colossus-a-start-to-slowing-auto-insurance-company-abuse/

As such, it may come as no surprise that drivers all over the country have been frustrated with Allstate.

Consumer complaints have increased against both Allstate Insurance Company and Allstate Property and Casualty Insurance Company, and, in recent years, Allstate Insurance Company has been one of the Top 5 most-complained-about auto insurers among the nearly 80 auto insurance companies doing business in Michigan.

In Consumer Reports Magazine's 2010 Car Insurance Ratings survey, Allstate Insurance Company received the sixth lowest "Reader Score" rating for "overall satisfaction with claims handling." The auto insurer also received unfavorable ratings for timeliness of claims payments and non-claims-related problems.

Finally, among Michigan's largest auto insurers, the auto insurance rates for Allstate Insurance Company were among the Top 5 most expensive in all 16 of the major Michigan markets examined in compiling the "Worst Auto Insurance Companies" list, and the rates for Allstate Property and Casualty Insurance Company were among the Top 5 most expensive in 15 of the 16 major Michigan markets examined.

3. Secura Insurance Winner of the ‘Putting A Low-Ball Price On Human Life’ Award

Secura Insurance makes my list of worst auto insurance companies because of the way it defended a case I had with them last year, which sadly is representative of how Secura defends many of its cases from my experience.

My client was an innocent 83-year-old man who was killed while crossing the street. He was legally in the crosswalk when he was run over by a truck driver with a long history of violations, including speeding tickets and improper lane changes.

In Shekoski v. Allied Excavation, Inc., et al., Secura Insurance took the position that an 83-year-old man's life was not worth more than $250,000. In fact, I was told during the case that an old man who gets run over by a truck is not worth more than $250,000. And that is what Secura offered up through and during the trial (Secura did change its offer to $500,000 as the jury was deliberating).

This was despite the driving record of its own truck driver, and despite the fact that Michael Shekoski suffered terribly until his death. Mr. Shekoski left behind 10 children, 38 grandchildren and 18 great-grandchildren who survived him.

Thankfully, a Macomb County jury placed a higher value on human life than Secura Insurance did: The jury returned a verdict in favor of Mr. Shekoski's estate for $2.55 million.

4. Dairyland Insurance My ‘Worst Insurance Company in Michigan’ Award

I’ve never seen any insurance company send a release to its own injured customers extinguishing all of their legal rights, past, present and future, just SEVEN days after a crash - until Dairyland Insurance did just this. The accident victim signed this release, and lost all future No-Fault insurance benefits and claims.

5. Farm Bureau Insurance Winner of the ‘Skunk’ Award

A lawyer is not supposed to stand up in court and intentionally mislead a jury. But Farm Bureau is doing this in serious auto accident injury cases every day. In the case of an actual Michigan Auto Law client, Farm Bureau insured the vehicle of an 18-year-old from Adrian who slammed into a man's SUV while she was speeding on the dirt shoulder. The car accident victim in the SUV had to be transported to the hospital by helicopter. The driver admitted to reckless driving.

But instead of taking financial responsibility or making any meaningful attempts to settle this case and protect its own customer, Farm Bureau's defense strategy was to hang its customer out to dry. In fact, the defense was basically hoping the jury would feel sorry for the at-fault teenage driver by deliberately trying to suggest that she was the one who would be paying up - instead of Farm Bureau.

Because of this case, and because of some very anti-consumer changes in its "underinsured motorist" (UIM) policies, and the fact that Farm Bureau Insurance has been one of the Top 5 most-complained-about auto insurers among the nearly 80 auto insurance companies doing business in Michigan in recent years, Farm Bureau Insurance wins my "Skunk" Award for 2013.

6. Progressive Insurance The ‘Worthless Coverage’ Award

What is buried in the fine print? How about completely worthless auto insurance that you paid a lot of money for. This tough lesson was exemplified by my case, Carducci v. Progressive et. al. My client, Amie Carducci, of Clinton Township, was struck nearly head-on at age 28. She had 13 surgeries, spent almost a month in the hospital, and suffered a traumatic brain injury. The driver who hit Amie did not have auto insurance. But Amie had purchased uninsured motorist coverage (UM) from Progressive, which is supposed to protect someone if she's injured in a car accident by an uninsured driver. Too bad Progressive's uninsured motorist coverage was worthless and completely failed to protect Amie because of what the Progressive buries in its policy.

In recent years, consumer complaints have increased against Progressive Michigan Insurance Company and Progressive Michigan has been one of the top 5 most-complained-about auto insurers among the nearly 80 auto insurance companies doing business in Michigan each of the last five years.

Additionally, among Michigan's largest auto insurers, Progressive Michigan Insurance Company is at the bottom of the list for paying out the smallest percentage of its premium dollars in claims for its auto-insurance customers.

Finally, among Michigan's largest auto insurers, the auto insurance rates for Progressive Michigan Insurance Company were among the Top 5 most expensive in all 16 of the major Michigan markets examined in compiling the "Worst Auto Insurance Companies" list, and in 14 of those markets, Progressive Michigan's auto insurance rates were the most expensive.

7. Citizens Insurance Company & Auto Club Insurance Association ‘Dishonorable Mentions’ Award

Both Auto Club Insurance Association and Citizens Insurance Company of America has been two of the top 5 most-complained-about auto insurers among the nearly 80 auto insurance companies doing business in Michigan in recent years.

Consumer complaints against Citizens Insurance Company of the Midwest have increased by more than 100% between 2010 and 2011 and Citizens Insurance Company of America is near the bottom of the list for paying out the smallest percentage of its premium dollars in claims for its auto-insurance customers.

Among Michigan’s largest auto insurers, the auto insurance rates for Citizens Insurance Company of America were among the Top 5 most expensive in all 16 of the major Michigan markets examined in compiling the "Worst Auto Insurance Companies" list.

Finally, through their parent company, The Hanover, both Citizens insurers have received below average ratings from J.D. Power and Associates two out of the last three years.


The following chapters will explain in greater detail why Michigan Auto Law’s auto accident attorneys chose these insurance companies as the "Worst Auto Insurance Companies."

Chapter 4

State Farm Insurance ‘Repeat Offender for Abusing Auto Accident Victims’ Award

Our insurance lawyers want to stress that State Farm is definitely not like a good neighbor, which is why State Farm Mutual Automobile Insurance Company is on Michigan Auto Law's list of the worst auto insurance companies in Michigan. In my opinion, State Farm Mutual Automobile Insurance Company has been the most aggressive in fighting its customers before paying No-Fault insurance benefits.

And, it has proved to be a profitable strategy - unless you need State Farm insurance benefits.

Profits for State Farm Mutual Automobile Insurance Company increased by nearly 100% from 2009 to 2011. According to the 2011 and 2010 Annual Reports to its policyholders, State Farm Mutual Automobile Insurance Company's net income increased from $570 million in 2009 to nearly $1.1 billion in 2011.

As an insurance lawyer, I don't begrudge State Farm for making a profit. But I do blame State Farm for overcharging Michigan drivers. Here's how the calculation was made: since 1996, auto  accident claims in Michigan have declined by 54 percent and the average miles traveled have dropped to the lowest in 17 years. Yet insurance rates continue to skyrocket, as Michigan has the second most expensive car insurance in the nation (right behind Louisiana), according to The New York Times' April 12, 2010, "Bucks" blog post, "Where Auto Insurance Is Most Expensive."

Moreover, as noted below, State Farm Mutual Automobile Insurance Company has some of the most expensive auto insurance rates in Michigan.

State Farm was one of those insurance companies that lobbied hard to convince the Michigan Legislature to enact the harshest auto accident injury (threshold) law in the nation in 1995, promising that Michigan residents would reap substantial savings on their premiums as a result.  Well, auto accident lawsuits have fallen 54 percent since then, which means insurance companies are saving hundreds of millions of dollars in litigation payouts.

State Farm, where is our savings?

State Farm Mutual Automobile Insurance Company prefers to fight, rather than help, seriously injured auto accident victims

In a recent case, Hannosh v. Varadi, et al., where State Farm's insured undisputedly rear-ended an innocent driver and the injured driver had to undergo disc herniation surgery, State Farm stubbornly and unjustifiably dug in its heels and refused to offer any compensation to the victim.

By insisting the crash was not severe enough to cause the victim's obvious injuries, State Farm forced the case to go to trial.

Fortunately for the victim, a restaurant manager whose accident-related injuries had disabled him from working, a Macomb County jury had the wisdom to recognize the injustice that State Farm had committed itself to denying.

The jury returned a verdict in favor of the victim for $1.485 million.

State Farm Mutual Automobile Insurance Company is THE most-complained-about auto insurer in Michigan

Every year for the last five years (2007-2011), State Farm Mutual Automobile Insurance Company has been THE most-complained-about auto insurer among the nearly 80 auto insurance companies doing business in Michigan, according to data from the Michigan Office of Financial and Insurance Regulation (OFIR).

That means that during those years State Farm Mutual Automobile Insurance Company received more consumer complaints than each of the other nearly 79 Michigan auto insurers.

State Farm Mutual Automobile Insurance Company auto insurance prices are some of the most expensive in Michigan

Among Michigan's largest auto insurers, the auto insurance rates for State Farm Mutual Automobile Insurance Company were among the Top 5 most expensive in all 16 of the major Michigan markets examined in compiling the "Worst Auto Insurance Companies" list.

Sources:

  1. Annual Reports to Policyholders of State Farm Mutual Automobile Insurance Company.
  2. The New York Times' April 12, 2010, "Bucks" blog post, "Where Auto Insurance Is Most Expensive."
  3. Insurance Institute of Michigan, 2010 and 2012 IIM Fact Book, "Top Writers of Auto Insurance in Michigan." (Page 27)
  4. "Insurance Company Complaint Ratios" ("Coverage Type: Automobile") for 2007 through 2011, Michigan Office of Financial and Insurance Regulation (OFIR).
  5. "2008 Buyers' Guide to Auto Insurance," Michigan Office of Financial and Insurance Regulation (OFIR)(Example 3: Pages 16-17).
Chapter 5

Allstate Insurance ‘Repeat Offender for Abusing Auto Accident Victims’ Award

Allstate is raking in huge national profits and still doesn't hesitate to overcharge Michigan drivers. That's why our car insurance lawyers are calling out Allstate on our list of the worst auto insurance companies.

Making billions in profits is clearly no problem for Allstate. According to Allstate's Earnings Press Releases, the auto insurance giant has raked in more than a billion dollars in annual profits 9 out of the last 13 years. Highlights include:

  • $4.9 billion in profits in 2006.
  • $4.6 billion in profits in 2007.
  • $3.18 billion in profits in 2004.
  • $2.7 billion in profits in 2003.
  • $2.7 billion in profits in 1999.
  • $2.2 billion in profits in 2000.

Based on earnings data for the first three quarters (the first nine months) of 2012, Allstate raked in profits of $1.9 billion, which is an average of $637 million per quarter.

Our car insurance lawyers have no problem with Allstate making a profit. What we don't like is how Allstate does it.

Allstate making record-breaking profits by taking advantage of auto accident victims

Documents made public in 2008 describe Allstate's "two-pronged strategy" for "systematically cut[ting] payments to customers as a way to boost profits" and "forc[ing] customers to accept reduced cash payouts or face years in court," according to the Herald-Tribune's April 6, 2008, article, "How a get-tough policy lifted Allstate's profits."

Here's how Allstate's strategy works, as detailed in the Herald-Tribune article:

1. The "company evaluates claims with a computer program" called Colossus, "designed to reduce [claims] payouts by as much as 20 percent of what the company once paid for the exact same [personal] injuries."

2. Then "Allstate pushes" car accident victims to accept quick, but very low, settlements. The company deliberately tries to settle injury cases "cheap" before people will hire an injury lawyer.

The approach often is combined with an implied, but sometimes quite explicit, threat that if a customer doesn't accept what Allstate offers right away, or has the nerve to hire an injury lawyer, then the customer will be punished.

The documents reveal that Allstate claims adjusters are trained to suggest that the customer will "spend years in court while … bills go unpaid" — a strategy Allstate spelled out in company guidelines for insurance claims adjusters as something that "forces the claimant and attorney to think about the obstacles they must overcome …"

Our car insurance lawyers are all too familiar with Allstate adjusters sitting on files and not returning calls – the start of delays that continue when an auto accident lawsuit is filed  without regard to the customer's health and welfare. This is part of  the three D's strategy: delay, deny and defend. Allstate routinely delays handling your claim and sending your No-Fault insurance benefits, denies you were hurt and defends their wrongs in court. The 3D's forces people to hire lawyers and further delay in litigation, before paying out a compromised settlement in the end.

Allstate pays $10 million to train nation's Insurance Commissioners to oversee Allstate's use of 'Colossus' computer software

In 2010, Allstate was finally held accountable for its use of the Colossus computer software to reduce the amount of money the insurance giant was paying out on auto accident claims. Allstate entered into an agreement with insurance commissioners across the country whereby Allstate promised to:

  • Notify auto accident victims and their lawyers when Colossus claims software is being used to adjust their personal injury claims.
  • Stop rewarding its insurance claims adjusters for settling car accident claims for the amounts specified by the Colossus computer program.
  • Pay $10 million to train insurance commissioner personnel to monitor and evaluate Allstate's continued use of Colossus.

http://www.michiganautolaw.com/auto-lawyers-blog/2011/03/24/allstate-confesses-to-using-computer-program-to-reduce-settlements-for-auto-accident-victims-in-michigan/

http://www.michiganautolaw.com/auto-lawyers-blog/2011/04/06/allstates-agreement-to-change-its-use-of-colossus-a-start-to-slowing-auto-insurance-company-abuse/

Allstate forced to pay $21 million for targeting doctor who regularly treated auto accident victims

In its January 2011 opinion in Allstate Insurance Company v. Dodson (2011 Ark. 19, #10-257), the Supreme Court of Arkansas upheld a $21 million verdict for compensatory and punitive damages against Allstate Insurance Company for defaming Arkansas radiologist Jon H. Dodson, M.D., whose medical clinics regularly providing physical therapy services to injured auto accident victims.

http://opinions.aoc.arkansas.gov/WebLink8/ElectronicFile.aspx?docid=55719&dbid=0

According to the Supreme Court of Arkansas's opinion, Allstate sought to discourage auto accident victims from using Dr. Dodson's physical therapy services and to discourage lawyers from sending their injured clients to Dr. Dodson for help.

Based on evidence referenced in the Allstate Insurance Company v. Dodson opinion, one can conclude that Allstate carried out its plan by refusing to pay claims that involved Dr. Dodson's services and by using Allstate's agents to get the word out that there was something "illegal" and "fraudulent" about Dr. Dodson's practice and business.

In rejecting Allstate's objection to the punitive damage award, which was $15 million, the Supreme Court of Arkansas said the following:

"The enormity of the wrong is great enough to support punitive damages, considering that Allstate continued this conduct over a period of several years resulting in severe damages to [the physical therapist's] reputation and medical practice. Also supportive of the assessment of punitive damages is the fact that this course of conduct was taken by a nationally recognized insurance agency and, apparently, in accordance with their national claims practices and procedures to curb small, soft-tissue claims."

Allstate receives unfavorable ratings in Consumer Reports survey

In Consumer Reports Magazine's 2010 Car Insurance Ratings survey, Allstate Insurance Company received the sixth lowest "Reader Score" rating for "overall satisfaction with claims handling." The auto insurer also received unfavorable ratings for timeliness of claims payments and non-claims-related problems.

Complaints from Michigan consumers have increased against Allstate

Consumer complaints against Allstate Property and Casualty Insurance Company have increased 360% between 2008 and 2011, according to data gathered by the Michigan Office of Financial and Insurance Regulation (OFIR).

Similarly, consumer complaints against Allstate Insurance Company have increased approximately 77% between 2010 and 2011, according to OFIR data.

Allstate is one of the most-complained-about auto insurers in Michigan

Allstate Insurance Company was one of the top 5 most-complained-about auto insurers among the nearly 80 auto insurance companies doing business in Michigan two out of the last three years, according to data from the Michigan Office of Financial and Insurance Regulation (OFIR).

That means that during those years Allstate Insurance Company received more consumer complaints than any of the nearly 70 other auto insurers.

Allstate auto insurance prices are some of the most expensive in Michigan

Among Michigan's largest auto insurers, the auto insurance rates for Allstate Insurance Company were among the Top 5 most expensive in all 16 of the major Michigan markets examined in compiling the "Worst Auto Insurance Companies" list, and the rates for Allstate Property and Casualty Insurance Company were among the Top 5 most expensive in 15 of the 16 major Michigan markets examined.

When choosing your auto insurance company, you might want to think twice about landing in the "safe hands" of Allstate.

Sources:

  1. Allstate Earnings Press Releases.
  2. "How a get-tough policy lifted Allstate's profits," Herald-Tribune's April 6, 2008, article. http://www.heraldtribune.com/article/20080406/NEWS/804060659
  3. Allstate Insurance Company v. Dodson (2011 Ark. 19, #10-257), http://opinions.aoc.arkansas.gov/WebLink8/ElectronicFile.aspx?docid=55719&dbid=0
  4. Insurance Institute of Michigan, 2010 and 2012 IIM Fact Book, "Top Writers of Auto Insurance in Michigan." (Page 27)
  5. "Insurance Company Complaint Ratios" ("Coverage Type: Automobile") for 2007 through 2011, Michigan Office of Financial and Insurance Regulation (OFIR).
  6. "2008 Buyers' Guide to Auto Insurance," Michigan Office of Financial and Insurance Regulation (OFIR)(Example 3: Pages 16-17).
  7. Consumer Reports Magazine, 2010 October, Car Insurance Ratings survey.
Chapter 6

Secura Insurance Winner of the ‘Putting A Low-Ball Price On Human Life’ Award

Secura Insurance makes the list of Michigan's worst auto insurance companies because of the disgraceful way it cynically defended an excavation business whose truck driver struck and killed an 83-year-old man who was using a crosswalk to cross the street.

In Shekoski v. Allied Excavation, Inc., et al., Secura Insurance took the jaw-dropping position that 83-year-old Michael Shekoski's life was not worth more than $250,000, even though his tragic and senseless death left an enormous hole in the lives of the 10 children, 38 grandchildren and 18 great-grandchildren who survived him.

Aside from insinuating that Mr. Shekoski was already essentially "damaged goods" due to various health concerns, Secura Insurance insisted that his family should not be compensated any money for the "loss" of his companionship and society because, even if he had not been killed by the excavation truck, he was not going to live that much longer anyway.

Thankfully, a Macomb County jury, not Secura Insurance, had the last word about Mr. Shekoski's life and wrongful death. After deliberating only a short time, the jury demonstrated that it placed a much higher value on human life than Secura Insurance did: The jury returned a verdict in favor of Mr. Shekoski's estate for $2.55 million.

Chapter 7

Dairyland Insurance ‘Worst Insurance Company in Michigan’ Award

I've seen a lot of dirty tricks pulled by Michigan auto insurance companies over the years, but what Dairyland Insurance did to a group of unsuspecting accident victims tops my list of the worst auto insurance companies. I've never seen an auto insurance company send a legal release to its own injured customers that extinguishes all of their legal rights and claims SEVEN days after a car accident.

This happened in one of our cases, and the unsuspecting auto accident victims signed the release their own adjuster sent to them, not understanding they were giving up all of their rights to No-Fault insurance benefits including medical treatment and wage loss.

Who would even think doing this to their own customers in order to avoid the responsibility of paying insurance benefits?

Here's the story: Three people were injured in a car accident on March 1. They contacted their insurance company, Dairyland. On March 8, Dairyland sent a document to the injured people, releasing them of all of their Michigan No-Fault insurance claims – including the right to future No-Fault insurance benefits. Again, this was a legal contract that extinguishes all future rights and claims. And it was sent within a week of the car accident. People usually don't even get an application for benefits within seven days of contacting their own insurance companies…

As an attorney, I've helped hundreds of people injured in auto accidents; and the other 17 lawyers at Michigan Auto Law have probably helped thousands. None of our lawyers - who handle serious auto accident cases day in and day out - have ever seen an insurance company send a full release to its own customers within days of a crash.

Take a look at the releases from Dairyland.

The lesson people can take away from Dairyland

This is a perfect example of how important it is to always consult an attorney before signing ANY document or release after a car accident. A good injury lawyer will not charge you to answer a few questions, so it's best to call instead of making a serious mistake.

What Dairyland Insurance company did in this case is the most predatory thing I have ever seen an insurance company pull on its own customers. And I've seen a lot. If these Dairyland insurance customers now need lost wages, or medical treatment or an expensive surgery, this release arguably completely absolves Dairyland of any responsibility to provide the benefits that by Michigan law, it must provide.

Please don't let this happen to you.

Chapter 8

Farm Bureau Insurance Company Winner of the ‘Skunk’ Award

Farm Bureau Insurance Company makes No. 2 on my list of Michigan's worst auto insurance companies. Our auto insurance lawyers believe Farm Bureau is a skunk because instead of protecting its own customer by agreeing to settle her serious personal injury claim, Farm Bureau did the opposite: exposing its customer to a verdict that could ruin her - by trying to make the jury believe she had no auto insurance and she would have to pay the verdict, not Farm Bureau.

In one of our cases called Mayher v. Martin, Farm Bureau insured the vehicle of an 18-year-old Lenawee County teenager who slammed into a man's SUV while she was speeding illegally on the dirt shoulder, to avoid waiting a few extra seconds for traffic to clear. Mr. Mayher was seriously injured in the auto accident and had to be transported to the hospital by helicopter. He suffered a serious traumatic brain injury and shoulder injuries. Despite the seriousness of these personal injuries, the Farm Bureau insurance adjuster refused to make any meaningful attempts to settle this case (Farm Bureau insured the defendant teenager).

Instead, the Farm Bureau defense team wanted the jury to believe the teenage driver was the one who would be paying up instead of Farm Bureau itself. The claims adjuster told us that a jury would never return a significant verdict because they would feel sorry for her, thinking she would never be able to pay. In reality, the teen's family had purchased Farm Bureau as insurance in case she ever caused an accident. Farm Bureau was counting on this jury to improperly use unfair, outside considerations to deliberately avoid responsibility for a catastrophic car accident injury its own customer caused.

Farm Bureau took the reason all of us purchase insurance and stood it on its head.

Why Farm Bureau would not settle the car accident lawsuit

Why would an insurance company, in a very serious car accident case — where everyone agrees the teenager who caused the crash acted recklessly (she pled guilty to reckless driving in criminal court) - refuse to make any meaningful attempts to settle and instead force a case to trial?

Because, there's a rule of evidence that's been adopted by almost all states, that says juries cannot be informed whether a defendant in a car accident lawsuit has auto insurance, or whether an insurance company will be paying the verdict. Farm Bureau just took this one step farther - deliberately trying as a strategy to have the jury think it's an individual, uninsured defendant who will be paying the auto verdict.

But in this case, Farm Bureau made an intentional calculation that turns the public policy of not telling juries about the existence of insurance on its head. Farm Bureau deliberately forced this catastrophic TBI case to trial, hoping to get off cheap.

Keep in mind, the teenage driver served 30 days in jail for felony reckless driving. But that was not disclosed to the jury either.

Farm Bureau's uninsured motorist coverage policy

In addition  to Mayer v. Martin, we've seen some anti-consumer changes Farm Bureau has recently made that harms its customers. Farm Bureau's uninsured (UM) policy becomes worthless, because Farm Bureau claims adjusters are trying to force auto accident injury victims to trial with the negligent party's insurance company that wants to settle and pay their full insurance policy limits.

Also, for Farm Bureau customers who had purchased important uninsured (UM) and underinsured motorist coverage (UIM), Farm Bureau shortened the normal 3-year period to bring a lawsuit to only one year.  The state of Michigan was so concerned by what Farm Bureau was doing that it later issued an order making it illegal for Farm Bureau and other Michigan insurance companies to do this.

Way to go Farm Bureau - sticking it to a loyal, long-term customer and choosing to still apply a contractual term that was so anti-consumer that the insurance commissioner required you to change it.

Farm Bureau General is one of the most-complained-about auto insurers in Michigan

Given the insurers' disgraceful actions detailed above, it is no wonder that Farm Bureau General Insurance Company of Michigan was one of the top 5 most-complained-about auto insurers among the nearly 80 auto insurance companies doing business in Michigan two out of the last five years, according to data from the Michigan Office of Financial and Insurance Regulation (OFIR).

That means that during those years Farm Bureau General Insurance Company received more consumer complaints than any of the nearly 70 other auto insurers.

Sources:

  1. "Insurance Company Complaint Ratios" ("Coverage Type: Automobile") for 2007 through 2011, Michigan Office of Financial and Insurance Regulation (OFIR).
Chapter 9

Progressive Insurance The ‘Worthless Coverage’ Award

I always tell my clients and loved ones that before purchasing any auto insurance, you must ask yourself, "What is buried in the fine print?" Well, the fine print in Progressive's uninsured motorist coverage (UM) is particularly nasty. This is why Progressive is on Michigan Auto Law's list of the worst auto insurance companies.

In my case, Carducci v. Macomber, Detroit Edison, Progressive et. al, my client, Amie Carducci, was only 28 when she was struck nearly head-on by a negligent driver. She had 13 surgeries, spent nearly a month in the hospital, and has no memory of the crash due to her traumatic brain injury.

The driver who hit Amie did not have auto insurance. Amie, however, had purchased uninsured motorist coverage (UM) from Progressive. UM coverage is supposed to protect someone if she is injured in a car accident at the hands of an uninsured driver. Amie, like tens of thousands of Michigan residents, thought it would protect her. Remember, in some cities, such as Detroit and Pontiac, up to 50 percent of drivers are driving without insurance, so UM is important coverage.

But the UM coverage Amie purchased from Progressive was worthless. What Amie didn't know was that Progressive had a policy allowing it to "set off" (subtract) the medical expenses and wage loss Amie's workers compensation carrier had paid Amie before paying her uninsured motorist coverage. In other words, Progressive could subtract medical bills and wage loss being paid by another insurance company to avoid paying out on uninsured motorist coverage.

End result: Amie got nothing - $0 - for all of her injuries, pain and suffering, and surgeries from being hit by an uninsured driver. This all happened despite paying money to Progressive for coverage that was specifically meant to protect her if something exactly like this were ever to happen!

How Progressive's uninsured motorist coverage policy affects you

This makes the Progressive policy that Amie Carducci purchased completely worthless. It means Progressive and other Michigan auto insurance companies can pocket the extra premiums they charged for these policies. And the "uninsured driver" protection its own customers are paying Progressive is also worthless.  In fact, the more seriously hurt these Progressive customers are, the less likely Progressive is to pay anything.

If someone isn't hurt badly, the insurance company can file a motion for summary disposition and have its defense lawyers try to have the case dismissed under Michigan's harsh auto accident injury threshold law. But if someone is badly injured, Progressive can subtract the wage loss and medical bills from the coverage and again, pay nothing!

Sound too horrible to be true?  It's not. Amie received nothing from Progressive Insurance Company because of the fine print.

This means every person that buys UM and UIM from Progressive and some other insurance companies in Michigan may get nothing if they're badly hurt and have other insurance, because auto insurance companies get to deduct insurance benefits paid for serious injuries from its UM and UIM coverage.

That kind of coverage is no coverage at all. It's "worthless coverage."

How you can protect yourself in the event of a car accident with an uninsured driver

In Michigan, uninsured motorist coverage is an optional coverage, meaning it is not mandatory and people who want it can pay a higher premium to protect themselves. Our insurance attorneys strongly recommend this coverage to all of our clients and friends. The cost is that of a movie and popcorn and it's so well worth it.

Make sure to purchase a high policy amount. Let's hope you don't have 13 surgeries and huge medical bills like Amie did -  that Progressive can "offset" to avoid paying.

Progressive Michigan Insurance Company is one of the most-complained-about auto insurers in Michigan

Progressive Michigan Insurance Company was one of the top 5 most-complained-about auto insurers among the nearly 80 auto insurance companies doing business in Michigan each of the last five years, according to data from the Michigan Office of Financial and Insurance Regulation (OFIR).

That means that during those years Progressive Michigan Insurance Company received more consumer complaints than any of the nearly 70 other auto insurers.

Progressive Michigan Insurance Company pays a small percentage of premiums on claims

Among Michigan's largest auto insurers, Progressive Michigan Insurance Company is at the bottom of the list for paying out the smallest percentage of its premium dollars in claims for its auto-insurance customers, according to loss ratio data gathered by the Michigan Office of Financial and Insurance Regulation (OFIR).

For instance, for every premium dollar Progressive Michigan Insurance Company receives from Michigan drivers, it only pays out approximately $.48 in auto accident claims submitted by its auto-insurance customers.

Progressive Michigan Insurance Company auto insurance prices are some of the most expensive in Michigan

Among Michigan's largest auto insurers, the auto insurance rates for Progressive Michigan Insurance Company were among the Top 5 most expensive in all 16 of the major Michigan markets examined in compiling the "Worst Auto Insurance Companies" list.

And, in 14 of those markets, Progressive Michigan's auto insurance rates were the most expensive.

Complaints from Michigan consumers have increased against Progressive Michigan Insurance Company

Consumer complaints against Michigan Progressive Insurance Company increased between 2010 and 2011, according to data gathered by the Michigan Office of Financial and Insurance Regulation (OFIR).

Sources:

  1. Insurance Institute of Michigan, 2010 and 2012 IIM Fact Book, "Top Writers of Auto Insurance in Michigan." (Page 27)
  2. "Insurance Company Complaint Ratios" ("Coverage Type: Automobile") for 2007 through 2011, Michigan Office of Financial and Insurance Regulation (OFIR).
  3. "2008 Buyers' Guide to Auto Insurance," Michigan Office of Financial and Insurance Regulation (OFIR)(Example 3: Pages 16-17).
  4. "The Competitiveness and Premium Excessiveness of the … Auto Insurance Industr[y] in the State of Michigan," Michigan Office of Financial and Insurance Services (OFIS)[Now known as the Michigan Office of Financial and Insurance Regulation (OFIR)]("Appendix L: Auto Insurance Companies' Combined Loss Ratios …")
Chapter 10

Citizens Insurance Company & Auto Club Insurance Association ‘Dishonorable Mentions’ Award

Auto Club Insurance Association is one of the most-complained-about auto insurers in Michigan

Auto Club Insurance Association was one of the top 5 most-complained-about auto insurers among the nearly 80 auto insurance companies doing business in Michigan every year for the past five years (2007-2011), according to data from the Michigan Office of Financial and Insurance Regulation (OFIR).

That means that during those years Auto Club Insurance Association received more consumer complaints than any of the nearly 70 other auto insurers.

Auto Club Insurance Association's status as a most-complained-about auto insurer may come as no surprise to anyone familiar with Michigan Supreme Court Justice Michael F. Cavanagh's scathing dissent to the high court's July 28, 2006, decision in Cameron v. Auto Club Insurance Association.

http://publicdocs.courts.mi.gov:81/OPINIONS/FINAL/SCT/20060728_S127018_100_cameron3oct05-op.pdf

In response to the Republican majority's decision to relieve ACIA of the obligation to pay for a young auto accident victim's No Fault benefits, Cavanagh described ACIA as follows:

"This case is essentially the second installment of [Auto Club Insurance Association's] attempt to further immunize itself and other insurers from having to pay benefits indisputably owed to their injured insured—people who have diligently paid policy premiums with the expectation that, should they be injured, their insurer will reimburse them for all allowable expenses."

Citizens Insurance Company of America is one of the most-complained-about auto insurers in Michigan

Citizens Insurance Company of America was one of the top 5 most-complained-about auto insurers among the nearly 80 auto insurance companies doing business in Michigan two out of the last five years, according to data from the Michigan Office of Financial and Insurance Regulation (OFIR).

That means that during those years Citizens Insurance Company of America received more consumer complaints than any of the nearly 70 other auto insurers.

Complaints from Michigan consumers have increased against Citizens Insurance Company of the Midwest

Consumer complaints against Citizens Insurance Company of the Midwest increased by more than 100% between 2010 and 2011, according to data gathered by the Michigan Office of Financial and Insurance Regulation (OFIR).

Citizens Insurance Company of America pays a small percentage of premiums on claims

Among Michigan's largest auto insurers, Citizens Insurance Company of America is near the bottom of the list for paying out the smallest percentage of its premium dollars in claims for its auto-insurance customers, according to loss ratio data gathered by the Michigan Office of Financial and Insurance Regulation (OFIR).

For instance, for every premium dollar Citizens Insurance Company of America receives from Michigan drivers, it only pays out approximately $.56 in auto accident claims submitted by its auto-insurance customers.

Citizens Insurance Company of America's auto insurance prices are some of the most expensive in Michigan

Among Michigan's largest auto insurers, the auto insurance rates for Citizens Insurance Company of America were among the Top 5 most expensive in all 16 of the major Michigan markets examined in compiling the "Worst Auto Insurance Companies" list.

Citizens Insurance Company received below average ratings from J.D. Power and Associates

Citizens Insurance Company of the Midwest and Citizens Insurance Company of America, through their parent company, The Hanover, received below average ratings two of the last three years in the J.D. Power and Associates U.S National Auto Insurance Study (2009-2011).

Sources:

  1. Insurance Institute of Michigan, 2010 and 2012 IIM Fact Book, "Top Writers of Auto Insurance in Michigan." (Page 27)
  2. "2008 Buyers' Guide to Auto Insurance," Michigan Office of Financial and Insurance Regulation (OFIR)(Example 3: Pages 16-17).
  3. "The Competitiveness and Premium Excessiveness of the … Auto Insurance Industr[y] in the State of Michigan," Michigan Office of Financial and Insurance Services (OFIS)[Now known as the Michigan Office of Financial and Insurance Regulation (OFIR)]("Appendix L: Auto Insurance Companies' Combined Loss Ratios …")
  4. "Insurance Company Complaint Ratios" ("Coverage Type: Automobile") for 2007 through 2011, Michigan Office of Financial and Insurance Regulation (OFIR).
  5. J.D. Power & Associates 2012 U.S. Auto Claims Satisfaction Study; J.D. Power & Associates 2011 U.S. Auto Claims Satisfaction Study; J.D. Power & Associates 2010 U.S. Auto Claims Satisfaction Study; and J.D. Power & Associates 2009 U.S. Auto Claims Satisfaction Study.
  6. J.D. Power & Associates 2011 U.S. National Auto Insurance Study; J.D. Power & Associates 2010 U.S. National Auto Insurance Study; J.D. Power & Associates 2009 U.S. National Auto Insurance Study.
  7. Cameron v. Auto Club Insurance Association (Michigan Supreme Court, July 28, 2006, dissenting opinion by Justice Michael F. Cavanagh) http://publicdocs.courts.mi.gov:81/OPINIONS/FINAL/SCT/20060728_S127018_100_cameron3oct05-op.pdf
Chapter 11

How the Worst Auto Insurance Companies List was Created

Is the list of worst auto insurance companies in Michigan just our own opinion? Of course not. There is a ton of public data that we referenced in making this comprehensive list. But, we also value and welcome your own opinion. If you would like to share a personal story or experience you have had with an insurance company that you consider great (or terrible), you can tell us what you think at our Michigan Auto Law Forums, http://www.michiganautolaw.com/forum/.

But with 17 auto insurance attorneys and 30 professional staff that deal every day with insurance company claims adjusters and defense attorneys from every auto insurance company that writes auto policies in Michigan, our list is also based upon years of first-hand experience of what we see and how our clients are treated. Sometimes how people are treated in real life is very different from how they are treated in commercials.

Our insurance attorneys see something most people hopefully never will: how the auto insurance company you pay premiums to every year will actually honor its contractual promises when you need them after a serious car accident has occurred. And as the largest law firm in Michigan exclusively helping auto accident victims, it's probably fair to say that we see more than anyone else how insurance companies actually treat their own customers in times of need.

The following factors were used to create the our list of the Worst Insurance Companies:

Quantitative Sources (include):

  1. Insurance Institute of Michigan, 2010 and 2012 IIM Fact Book, "Top Writers of Auto Insurance in Michigan." (Page 27)
  2. "2008 Buyers' Guide to Auto Insurance," Michigan Office of Financial and Insurance Regulation (OFIR)(Example 3: Pages 16-17).
  3. "The Competitiveness and Premium Excessiveness of the … Auto Insurance Industr[y] in the State of Michigan," Michigan Office of Financial and Insurance Services (OFIS)[Now known as the Michigan Office of Financial and Insurance Regulation (OFIR)]("Appendix L: Auto Insurance Companies' Combined Loss Ratios …")
  4. "Insurance Company Complaint Ratios" ("Coverage Type: Automobile") for 2007 through 2011, Michigan Office of Financial and Insurance Regulation (OFIR).
  5. J.D. Power & Associates 2012 U.S. Auto Claims Satisfaction Study; J.D. Power & Associates 2011 U.S. Auto Claims Satisfaction Study; J.D. Power & Associates 2010 U.S. Auto Claims Satisfaction Study; and J.D. Power & Associates 2009 U.S. Auto Claims Satisfaction Study.
  6. J.D. Power & Associates 2011 U.S. National Auto Insurance Study; J.D. Power & Associates 2010 U.S. National Auto Insurance Study; J.D. Power & Associates 2009 U.S. National Auto Insurance Study.
  7. Cameron v. Auto Club Insurance Association (Michigan Supreme Court, July 28, 2006, dissenting opinion by Justice Michael F. Cavanagh) http://publicdocs.courts.mi.gov:81/OPINIONS/FINAL/SCT/20060728_S127018_100_cameron3oct05-op.pdf
  8. Consumer Reports Magazine, 2010 October, Car Insurance Ratings survey.

Qualitative Sources:

  1. Our own insurance attorneys' and client-communicated experiences with insurance claims adjusters in Michigan after car accidents and truck accidents
  2. Responsiveness to our attorneys through documentation and the handling of auto accident claims
  3. Insurance company and insurance defense attorney tactics before and during trials, including video surveillance and how responsibly they handle customer claims
  4. Insurance company responsiveness to legislative activities that directly affect No-Fault insurance  costs in this state
Chapter 12

Stopping the Fraud and Abuse from Michigan Auto Insurance Companies

If you've read my list of the worst auto insurance companies, you can surely see that some serious action needs to occur now - in order to regulate how these insurance companies are treating their own customers.

As a No-Fault insurance lawyer, I know that insurance companies treat people worse in Michigan than in most other states. If you've been injured in an auto accident, chances are you will experience the three D's from an auto insurance company when handling your claim. The insurance company will usually:

  1. Delay your insurance benefits,
  2. Deny you were injured in an auto accident, and then
  3. Defend aggressively, to get people to avoid hiring an insurance lawyer and to accept a compromised settlement.

No bad faith laws or punitive damages in Michigan

This happens because Michigan has no bad faith laws and no punitive damages to deter insurance companies from abusing their people like this.

Bad faith laws are laws that prohibit insurance companies from treating you unfairly and illegally. Bad faith is defined as an intentional dishonest act by not fulfilling legal or contractual obligations, misleading another, entering into an agreement without the intention or means to fulfill it, or violating basic standards of honesty in dealing with others. Hey auto insurance companies, does this sound familiar?!

Punitive damages are additional damages that a judge or jury can award when an insurance company acts with recklessness, malice or deceit. Michigan law does not allow judges or juries to award  punitive damages in car accident cases or any personal injury lawsuits for that matter. So insurance company defendants have no problem forcing legitimate cases to trial. Even if they lose, all they have to pay is the insurance policy limits. (This also means we have more "grasshoppers" - truckers who have caused so many truck accidents that they can't get jobs in states with punitive damages, so they come here.)

Michigan's pathetic Consumer Protection Act for insurance companies

For those of you who are unfamiliar, consumer protection laws are supposed prevent businesses from engaging in fraud or certain unfair practices and to protect consumers in the marketplace.

Unfortunately, this means nothing in Michigan, where insurance lawyers - incredibly  - cannot even use the Michigan Consumer Protection Act in claims against auto insurance companies.  The result is that once again, Michigan insurance company claims adjusters can treat people terribly and largely get away with it.

Michigan insurance companies already lead the nation in profitability, and Michigan is one of the few states without an insurance commissioner who can regulate how much profit these insurance companies can make; even though as residents, we are all required by law to purchase No-Fault insurance.

What you can do to ensure more fair auto insurance rates and protections

On a macroeconomic level, this all works out quite well for our auto insurance companies. Why? Auto accident victims in Michigan have been walking away from hundreds of millions of dollars in valid and deserving claims that No-Fault  insurance companies are legally required to pay. Many of these auto insurance companies believe you won't wait, you won't hire a No-Fault insurance lawyer to file an auto accident lawsuit, and you will eventually become so fed up or worn down by the claims adjuster that you will walk away or take a low-ball offer.

Some of the auto insurance companies on my list are the worst offenders.

These episodes scream out why Michigan must have bad faith insurance laws and punitive damages to deter such bad behavior. Without a "big stick" that can halt deliberate insurance company abuse, our auto insurance companies can get away with dishonest actions more than insurance companies in almost all other states.

What Michigan consumers can do to help

Here's what you can do to help:

Please write a letter to your local representative and ask that bad faith insurance laws be introduced in Michigan against insurance companies.

Call for punitive damages when insurance companies and others intentionally and recklessly cause injury, in order to stop them from doing it to others.

Do you have an insurance company horror story? Tell us about it by visiting the Michigan Auto Law "Forum," at www.michiganautolaw.com/forum. Let's not let these insurance companies get away with abusing our cherished Michigan families!

If you have questions about your auto insurance policy, or if you've been in an auto accident and your insurance company is mistreating you, feel free to call (800) 968-1001 to speak with one of our No-Fault lawyers. There is no cost or no obligation.

Chapter 13

How to Choose the Best Auto Insurance Company

We've given you Michigan Auto Law's list of the best auto insurance companies and our list of the worst auto insurance companies. And, for good measure, here's our list of the Top 4 Best Auto Insurance Companies in Michigan for 2013.

Now that you have this information, you can better protect yourself and your family. Our auto insurance lawyers realize that choosing an insurance policy can be daunting.

Accordingly, in addition to the "Best" and "Worst" information above, we hope the following tips can help you choose the best auto insurance company for you.

1. Visit the Michigan Office of Financial and Insurance Regulation (OFIR) website.

Formerly known as the "Insurance Bureau," the Michigan Office of Financial and Insurance Regulation (OFIR) is Michigan government's official web site for insurance-related information, including auto insurance. http://www.michigan.gov/lara/0,4601,7-154-35299_10555---,00.html

On the OFIR web site, you will find, among other things, information about "consumer complaints" for all of the insurance companies that sell policies in Michigan. Some of these will absolutely shock you, and give you a good flavor for how an insurance company you may be considering chooses to handle auto accident claims.

Moreover, the web site explains how complaints can be filed against Michigan's auto insurance companies.

Finally, the OFIR web site has helpful information about buying Michigan auto information.

2. Find out which insurers repair shops recommend.

One of the best ways to identify dependable auto insurers is to contact local collision repair shops that you trust, and ask for their recommendations. Shop managers have a unique perspective to offer, since they regularly interact with insurance claims adjusters. They know which insurance companies have the smoothest claim processes for routine Mini Tort claims and which companies are looking for shortcuts to cut costs at the expense of their own customers.

3. Consider working with an independent insurance agent.

Independent agents represent several insurance companies and therefore, do not have a vested interest in selling you a policy from one particular company. They can become familiar with your situation and guide you toward a suitable policy. Our auto insurance lawyers do not vouch for any particular one of these independent agents, but findmichiganinsurance.org is a great resource to search for independent insurance agents.

4. Do your research.

With so many people sharing reviews and testimonials both in social circles and on the Internet, you can get opinions from real people who have experienced insurance company claims first hand. Pay particular attention to those who have had personal injury claims from car accidents and truck accidents.

Online auto insurance resources for Michigan drivers

Our auto insurance lawyers have compiled this list of online resources to assist Michigan drivers with evaluating their No-Fault insurance:

  1. The Michigan government's website has a valuable "What to watch for" guide for buying insurance.
  2. As noted above, the State of Michigan's Office of Financial and Insurance Regulation (OFIR) also has a great website with information on purchasing auto insurance.
  3. The National Association of Insurance Commissioners' "Consumer Information Source" (CIS) provides information about insurance companies that you can use before purchasing insurance, including key information about closed insurance complaints, licensing information and financial data.

Conclusion

We hope our list of the best and worst auto insurance companies will help you protect your family, whether you're shopping for new auto insurance, or just checking to make sure your policy is sufficient.

If you need more information, visit our Michigan No-Fault Insurance Resource Center. It has information on No-Fault benefits, the No-Fault Act, Michigan mini-tort, Social Security Disability and additional coverage that can protect you if you're ever injured in an auto accident.

You're also welcome to call one of our insurance attorneys at (800) 968-1001. There's no cost or obligation, and we can answer all of your questions about your car accident or your No-Fault insurance policy.

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Michigan Auto Law is happy to offer a free copy of The Attorneys‚ Guide To The Best Auto Insurance Companies. To Download your free copy of this book please fill out the form below.