Albuquerque morning journal. [volume] (Albuquerque, N.M.) 1903-1926, 1911-08-24
SHARP CRITICISM
Of ACCIDENT
INSURANCE
METHODS OF SETTLING
CLAIMS QUESTIONED
Percentage Rejected or Scaled
Before Paid Too High De-
Clares Report of Special
Committee of Men,

u MUMMY doNfhh NnFctal leased Nlre.l
milwaukee,, WIS, Aug. 23.-lmpor-
tant legislation for the control Of in
surance companies doing industrial,
health ana accident business is pro-
posed in the report of tho special COM
mittee OF the Insurance commission
ers of the United States made public
today. The basis for the legislation
proposed is given in reports of the ev-
animation of fourteen companies In
which nearly 1000 settlements effect
ed by these companies are discussed
and criticised. In discussing the set
tlement OF these claims the report
says.
"of the specific claims examined.
whore the amount involved is consid-
cradle. the percentage OF scaled or
rejected claims is high; indeed, very
much too high TO be explained by er,
ror of judgment or carelessness.
Indeed, the committee feels war
ranted in concluding that when deal
ing with companies doing an industrl-
al health or accident business the
policyholder public OF the country has
too frequently been the victim of in
considerable practices In the claim
departments of the companies criti-
cized in this report.
Promises of reformation made at
the hearings are therefore. not
enough. This convention should take
action which viii guarantee the just
treatment OF policyholders In the
future
The companies, whose examination
was the occasion for the report follow.
Standard Accident Insurance com
pany, Detroit.
United states Health ana Accident
| Insurance company, Saginaw,
Massachusetts Accident company,
| Boston.
Great Eastern Casualty company,
New York.
Federal Casualty company, Detroit.
Equitable Accident company, Bos-
ton.
Continental Casualty company,
Hammond, Ind.
North American Accident Insurance
company, Chicago.
National Casualty company, Detroit.
Fidelity Accident company, Sagl-
nav, Mich
General Accident f. & L. Insurance
corporation.
American Assurance company, Phil
adelphia
Phoenix Preferred Accident COM
pany, Detroit.
German Commercial Accident COM
pany Philadelphia.
The report says of one company:
1T is impossible In language fitted
to an official document aptly to char
acteri2e what seems 10 have been the
practices and methods OF the industri-
al department OF this corporation IN
settling with Its policyholders. II ap-
pears to have resorted to every pos
sible means not merely to protect
itself against imposition for which
1t could not be criticized, but also,
and more particularly, to cut and
shave down claims apparently without
conscience and certainly without
right"
The report further says that only
two or three of the companies exam
ined have been found to be substantl-
ally undeseryng Of any criticism.
Three or -four others merely show IN
reasonably isolated cases either er-
rors IN adjustment, or that the bad
practices of competitors were some
times followed About half the COM
panies examined show serious condi-
tions in their claim departments
particularly the adjustment of spe-
effic claims Of considerable amounts.
while In at least two of such compa-
MES these conditions are so shocking
las to call for immediate and emphatic
reforms"
The report concludes with twenty
-four recommendation the most inn
portant OF which are.
That a standard of health and acct
dent provision law be enacted that
pro rating for change Of occupation
should be permitted only when the in
snred has actually changed his occu-
patton, that the policy fee be abolish
ed that all industrial agents and
collectors be licensed by the state.
that frequent examinations for the
covering not only financial conditions,
but also treatment OF policyholders be
conducted either by the Individual
states or by committee of the con-
venton, and that publicity be given
F, 10 the results Of all such examinations.
The report also recommended that
| the present investigation be continued
to the end, that all companies doing
Ian industrial, health and accident
business may be examined. The COM
mission asked that the Continental
Casualty company, National Casualty
company and Phoenix Preferred Aeci-
| don't company make changes of en-
ployes connected with adjustments.
The General Accident, Fire and
Life Assurance corporation is asked
to remove the heads of several depart
ments In this connection the COM
mittee states the company has signi-
| fled compliance.