DC Metro Area Personal Injury Law Blog

An 18 month investigation conducted by CNN discovered a strategy developed by Allstate and State Farm Insurance to "deny, delay and defend," valid personal injury claims in minor-impact, soft tissue injury crashed throughout the country.  The accidents are those in which there is little, if any property damage and the valid injury is not easy to see by the naked eye or on x-rays.

Documents obtained by CNN revealed that the strategy was developed in the mid 1990's, with the adoption of a tough take-it-or-leave-it strategy in dealing with such cases.  A former Allstate agent admitted that  company employees were encouraged to get rid of claims quickly and cheaply and even offered accident victims as little as $50.  The result has been billions in profits for insurance companies and little, if anything, for the public, according to University of Nevada insurance law professor Jeff Stempel.

Consulting giant McKinsey & Co., looking for a way to boost profits focused on soft-tissue injuries incurred in minor crashes. McKinsey documents obtained by CNN  numbered in the thousands and are under seal in courts around the country.

Both Allstate and State Farm declined requests for interviews. Robert Hartwig, president of the Insurance Information Institute, told CNN that insurers do not have a strategy of blanket denial of claims. He also said strategies to limit expenditures on minor-impact crashes are needed to fight fraud.