Dear Mr Roth,
I have reviewed your internet essay on the above topic. “DISCOVER WHAT INSURANCE COMPANIES DON’T WANT YOU TO KNOW ABOUT YOUR INJURY CLAIM”
It is important I state that I have worked for insurance companies in relation to personal injury claims for over twenty years in Australia and now Malaysia. I am an insurance professional and would not demean myself by behaving in the manner described in your essay / advertising feature. I join you in deploring unethical behavior by insurers which seeks to undermine the rights of injured people.
My further opinion, for what you may consider it to be worth, is that litigation of the sort you describe is the root of the world of personal injury evil. It can be, which is why professional ethics for lawyer prohibit bringing a claim without reasonable belief of its justification under the law and this belief must be based upon a due diligence process appropriate to the circumstance.
The purpose of insurance, at any level, is to restore the injured party to the position they enjoyed prior to the loss. Obviously, where permanent physical or psychiatric injury to a human being has occurred, no monetary award can have this effect. So the issue becomes “what is the fair pecuniary sum in lieu of restoring the physical or psychiatric health of the injured party”.
For most individuals in society, going to court and having a case tried before a judge or judge and jury is an horrifically intimidating venture. That individual risks a great deal. If they lose the case, they may become liable for the legal costs of the other party and thereby add further financial hardship to the injury they have sustained. In the United States, the plaintiff in a personal injury case does not have any exposure regarding the defendant’s legal fees. Recoverable costs are relatively minor and typically waived in exchange for a waiver of appeal, etc. But, you are certainly correct that there are personal costs for the plaintiff. That is why we don’t accept what we consider to be speculative cases and why in such cases we encourage clients to be careful not to set themselves up for further injury at the hands of the judicial system.
Their lawyer, engaged on a contingency fee basis, however risks little. He has the advantage of playing the numbers. He knows that, with personal injury cases, most results favor the injured plaintiff. Like a roulette wheel in which he has most numbers covered, he keeps spinning until one of the “winning” numbers comes up. And the payout on this roulette wheel is somewhat more satisfactory than the 35 to 1 odds offered by the casino. The lawyer grabs 40% of the award made to his client as his “fee”. Your share of Pete’s award of $1.2M would be $480K. Or, to do the sums, 160 hours of work @ $3,000 per hour for your time. Interestingly enough, no mention of this is made in your essay / advertising feature. Of course, personal injury practice can be very remunerative when practiced well. It has to be because the personal injury lawyer takes on substantial risk in every case. First, information provided by a client often turns out to be false or not provable. Second, it is a rare plaintiff that can advance out of pocket costs which in many cases where expert consultation and testimony is required, virtually every serious injury case, typically amounts to $50,000 or more. If the case is lost, the lawyer has little chance of recovering this back. In larger cases it is not uncommon when a client can advance costs to negotiate for a smaller contingency share for the lawyer. Frequently, the burden of carrying a case can extend over years. More, a lawyer committed to helping victims of negligence or worse will often take cases that are soft tissue and relatively minor. The insurance companies here tend to grind these cases to punish the injured party who had the gall to hire a lawyer to obtain a fair settlement or resolution of the case.
People injured in compensable circumstances are entitled to be awarded fair pecuniary sums to atone for their loss and hardship. Ethical insurance companies and their officers behave in such a way as to facilitate such settlements. It is called sharing the risk, which is the basis of insurance. The devil, of course, is in the details. Insurance companies goal is to remain profitable, as profitable as possible. Even ethical insurance company executives, such as yourself, must respond to these pressures. Further, what is fair pecuniary damages? From the adjuster’s point of view it is rarely the same as from the point of view of an injured party and frequently from the point of view of a jury.
People whose entitlement to compensation, either whole or in part, is dubious should not be encouraged to “try it on” for the sake of taking on the “rich” insurance companies. We agree on this, as I previously discussed. Additionally, your essay essentially advises people of the loopholes which may be available to them to increase the monetary benefit they receive from their loss. I don’t know what you mean by “loopholes” here and welcome further elucidation.
Ambulance-chasing lawyers whose motivation comes from either their own ego or their own greed do more harm to society than good. They continue to drive a wedge between insurers who want to do the right thing and the broader community who cannot continue to function without the benefits insurance provides to them. Ultimately, should your advertised modus operandi be perpetuated and giving full respect to the current position of business finances and performance worldwide, insurance companies will close their doors or cease to offer insurance covering people for unintended injuries caused to third parties. “Ambulance-chasing lawyers” is a term that I assume means those unethical lawyers foment litigation when no litigation should ensue. I certainly hope we don’t do that. I would accord to most lawyers the same benefit of the doubt regarding ethics and intention that you would accord to the typical adjuster for a liability carrier. I would admit to too many lawyers with questionable ethics and judgment in the area of personal injury practice. But, my philosophical view is that when a party is injured due to the fault of another, the insurance company wields the power and unaided by competent legal representation the injured party doesn’t stand a chance. I do heartily disagree though about the risk you perceive to the insurance industry. Except for hurting from some “insane” investment decisions I see insurance companies doing pretty darn well.
Good luck litigating in the future when the award your client seeks can come only from forcing another law-abiding individual to sell their home as that person can’t get public liability insurance. Or third party motor liability insurance. The courts will have to re-think their position on a whole raft of case law. And the day is drawing closer when this scenario becomes real. I doubt it, but I’m sure reasonable minds can disagree without being disagreeable.
Regretfully, too many egos seem to be involved, from all sides of the philosophical divide, in California. Too many inflated egos seems to be a pervasive problem in the world in every walk of life.
Kind Regards,
Darren Walker
Head of Bodily Injury ClaimsAmAssurance Berhad
Direct Line 03-4043 2012
Mobile 017 254 9876
IAG-Consultant@ambg.com.my