Insurance Devils

by Brad Nelson11/13/17

There’s a reason I’m not a Democrat. People makes mistakes. And very often, those mistakes can be corrected. The world should not generally be completely re-ordered because something bad happened to one person, one time. No amount of laws and bureaucracy can ever keep one bad thing from happening to one person.

But the insurance companies in this country can go to hell. Straight to hell, do not pass go. And, yes, I realize much of the problem isn’t lack of oversight but because of government collusion with the insurance market. This is the real reason your health care insurance keeps going up. But government does have a function in regards to preventing or rectifying fraud.

However, government is now part of the fraud with the insurance companies, as we see increasingly regarding health insurance. They are together along this duplicitious ride. My friend, Pat, has always been suspicious of the entire idea of insurance while I’ve been an apologist, at least for the general concept of it, of spreading the risk.

No more. Burn it all to the ground. Build a wall. Lock her up. And torch the insurance industry as we know it and start all over.

I received an email regarding the renewal of my car insurance. The rate went up 31%. And I’m going to try to make a long story short. My rates went up for two reasons:

1) Insurance fraud

2) Likely insurance fraud

Part of the rate increase was because the insurance company (PEMCO) had decided to change one of their formulas. Instead of (I think) the formula being the driving distance of round-trip to work, they went with a flat per-year mileage total. And what they did was start out with a default mileage total that was at least two times higher than my actual yearly mileage. I was able to rectify this via my local insurance representative. But I still consider that fraud by the insurance company itself. It did not first ask me what my yearly mileage was. It just wrote in a number, safe in the assumption that most people are not going to take the time to fight these bastards.

The second part of the 31% rate increase I put down to “likely insurance fraud.” I was told by my local agent (who’s a good enough guy) that my credit rating had fallen significantly. But I told him I own no one money (other than the small credit card debt which is paid in full monthly). He said however that Equifax, which most of these bastard insurance companies use for credit ratings, had reported that someone was trying to collect on me so therefore my rating was down.

So I got online and got my credit report fro Equifax. It was perfect. No blotches on it. I sent it to my local agent who then dug a little further. He emailed and told me that PEMCO uses a third party to assess and use these credit reports—to basically assign the scores and codes. That is, it wasn’t apparently the fault of Equifax even though they were recently hacked. My local rep said, and I quote, “The [PEMCO] rep told me that there doesn’t have to be a collection for the 3rd party to use the collection code…So theoretically I could have given them the information off your report and the 3rd party could still justify the “presence of collection” code…. So essentially I can pull all credit reports and still not know if the score I see on PEMCO is accurate.”

God bless my local agent for being helpful (after I first got angry and was insistent that he actually do something) and honest. I don’t blame him. And he does seem to recognize now what I would say is gross incompetence or built-in fraud regarding credit reporting.

You make the call. Mistake or fraud? But the lesson here is do not accept any increase in your insurance rates on anything without digging into it first.

Brad is editor and chief disorganizer of StubbornThings.
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Brad Nelson

About Brad Nelson

I like books, nature, politics, old movies, Ronald Reagan (you get sort of a three-fer with that one), and the founding ideals of this country. We are the Shining City on the Hill — or ought to be. However, our land has been poisoned by Utopian aspirations and feel-good bromides. Both have replaced wisdom and facts.
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5 Responses to Insurance Devils

  1. Kung Fu Zu Kung Fu Zu says:

    It is not only the insurance companies which are run this way. I believe most large American public companies are run in such a dishonest fashion.

    Of course privately owned companies can be run dishonestly, but there are cases where private owners have interests other than just profit. And honest company owners know that the responsibility for the honest operation of their companies rests with them. They may even have morals.

    There is no such thinking in bureaucratic publicly owned companies. In such a company there are three primary motivators for workers, 1) protection of their jobs, 2) protection of the bureaucracy and through this the workers’ jobs, 3) do what the company says and try to squeeze as much profit out of one’s customers as possible. The bottom line comes first, last and always. It becomes a mania and is one reason we are seeing these huge mergers which lessen competition.

    In large public companies, responsibility is amorphous. Workers don’t ask if something is wrong or right, they just ask if it is company policy and makes money.

    I will never forget hearing a woman who worked for a company which bought homes at public auctions for back taxes and such, bragging how she had grabbed one house for pennies on the dollar because the old man in his nineties who had owned the house had alzheimers and did not remember to keep up property tax payments on the home. (Another reason to hate property taxes) I could not understand how anyone could be so proud and jovial about doing such a thing. And no, “If I don’t do it, someone else will” does not qualify as a moral reason for this sort of action.

    By the way, contact AAA on insurance rates. I found they were substantially lower than others. Of course, you have to be a member to get the low rates. But that only costs about $55-60 per year and there are a number of good services which come with it.

    • Timothy Lane says:

      Note that this difference between private-owned and large corporate entities is what makes the death tax so important. A private company will be based in its home town, and the ownership will be active in local affairs (including charitable donations by the company as well as the owners). When the new owners can’t afford the death taxes and have to sell it off, it gets bought by some conglomerate in a distant mega-city such as New York, which ignores local concerns and thinks only of the bottom line. And if this means closing down the local facilities and setting up new ones in Mexico . . .

    • Brad Nelson Brad Nelson says:

      Mr. Kung, I think it’s reasonable to assume all three of your points.

      I can see some middle man “interpreter” of the credit scores having an incentive to “add value” to those credit scores. There is a clear incentive to “add value” by simply lowering the credit scores. And my own local insurance guy seems to be telling me there is an inherent arbitrariness to it. He also was honest enough to tell me that most people likely would not have taken the time to look into a smaller rate increase. He said that had my increase been about $50.00, he can imagine me not even bothering to look into it. And he’s likely right.

      My first thought upon hearing that Equifax’s records had been hacked (in conduction with my credit score suddenly being worse) was, “If someone is hacking these things, isn’t it more likely that they hate insurance companies and that my credit rating might be adjusted upward? Why the worse rating then?”

      It sounded fishy. But it’s interesting that, despite the hack, the Equifax rating was (to my eye) quite accurate. But this information was then being arbitrarily changed by some ass-wipe bureaucratic middle-man.

      And, listen, I made ZERO changes to anything in my life from last year to this. No sex change operation. Didn’t move to Portugal. Didn’t legally change my name. Didn’t vote for Hillary. Nothing. Therefore it required conscious and deliberate human input to change something that would increase the insurance company’s intake. I should have been on at automatic road to “Same as last year”. If it looks like a rat and smells like a rat, it probably is a rat.

      Your $55-60 per years sounds pretty good. I will keep that in mind. As it is, after the correction for fraud, mine is at $611.60 per year. I can knock 5% off of that if I pre-pay which would make if $581.02. But this whole episode left a bad taste in my mouth. Just as this lifetime Ford guy will not likely buy another Ford because of their sponsorship of the NFL, I will take a serious look next time at AAA. I wouldn’t mind having their service anyway.

  2. pst4usa says:

    You have really undersold my total contempt for insurance companies Brad.. I see no difference between them and the whole money for nothing crowd. Think about the scam, gather money from a lot of folks and if something bad happens to one pay them from the massive profits. All that would be fine except when a real disaster strikes, whoops, bankrupt, so sorry all you saps, but hey, don’t you worry, all the execs got paid, big time. By removing the worry, concerns and cost, we also remove the link between cause and effect for a lot of our actions. You get health insurance from your employer, (or soon the government), one wall between you and your doctor, your doctor gets paid by the Insurance company at about 42% of what he bills, another wall between you and he. Your company has no input as to what or why the doctor over charges to get the real dollars he needs to pay ridicules malpractice insurance bills, so the insurance company needs to raise its rates to your company and the cycle just spirals out of control, with the insurance companies just scooping tons of dollars off every part of this debacle, (scimming is just too small an image so scooping it is).
    Just imagine if we all paid ourselves the money we sent to insurance companies, by putting money aside every month, retirement could be easy street for all of us.

  3. Brad Nelson Brad Nelson says:

    As it turned out, “Who is Equifax?” was one of the questions in last night’s Jeopardy Tournament of Champions.

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