community spotlight
Deaf, Dumb & Blind
by Emily Landes
When disaster strikes, insurance claims quickly follow. But what follows insurance claims? Typically, a lot of frustration, says Amy Bach, executive director of United Policyholders, a nonprofit on a mission to help people deal with the labyrinthine world of insurance and get the money they are owed to fix their homes and businesses.
The organization was formed in 1991 and has been growing slowly but steadily ever since. Bach says she can thank global warming for United Policyholder’s recent higher profile in the media and in the consciousness of consumers. “There’s so many more disasters now,” she explains. “And the time when people really, really know they need us and where we can let them know that we exist is after natural disasters.”
Perhaps it’s not surprising then that the company was formed after one of Northern California’s most damaging recent natural disasters: the Loma Prieta earthquake. At the time, United Policyholders co-founder Ina DeLong was working as a claims supervisor for State Farm Insurance. She became suspicious that the company was intentionally ignoring structural damage to properties and only paying for cosmetic damage. “She felt that they were putting people’s lives in jeopardy by telling people that their homes were fine, when they weren’t,” Bach relays. When higher ups made DeLong’s agents get rid of basic assessment tools like levels, she quit and began a new mission helping people get the settlements they deserve after a disaster.
While DeLong came from within the insurance industry, Bach began her career by taking the industry to task. Her first job out of law school was with the New York State Consumer Protection Board, and her first role on the board was to sit on
a task force on tort reform in the insurance industry. Bach knew little about insurance and discovered that when she tried to research some facts, there was almost no information available. Instead, she says, all she could find was “spin
coming from the industry.”
She realized that there were few resources available for those who wanted a real analysis of insurance companies from an outsider’s perspective. When her path crossed with former insider DeLong, she quickly realized they could do a lot of good working together to protect and educate the insured.
One of the most important things for property owners to know, says Bach, is that a good working relationship with their insurance broker or agent is essential. She advises checking in at least once a year to make sure the broker is updated about any changes with the property, including the most recent rents. Only with the most up-to-date information can apartment owners be compensated accurately for loss of income after a displacing incident. A good relationship also makes it more likely that your agent will make sure to point out any important exclusions in the policy, which Bach says are becoming more and more common.
Bach believes you should be able to trust your agent but warns that consumers must be diligent. Always keep a set of notes during conversations with your agent and keep copies of all written communications. Also, make sure you keep a copy of the current policy somewhere off the property so that it is easily accessible after a loss. “You will not believe how hard it is to get that from an insurance agency after the fact,” she reveals. The more documentation you have after a loss, the quicker you will see an appropriate payout on your policy. But the check shouldn’t come too quickly either. Adjusters are under a lot of pressure to settle quickly and move on, perhaps before the full extent of the damage is discovered. “We don’t want people to be paranoid,” she clarifies. “We just want them to have their eyes open and understand that [making a claim is] a business negotiation.”
United Policyholders may have begun by offering advice, but it has stepped over the line into advocacy with its Amicus Project. Legal decisions are one of the biggest motivators for insurance companies, according to Bach. “We can advise people up the ying yang, but if the law favors the insurance companies, they’re going to do what they please,” she says.
Here’s how the project works. A property owner has a dispute with the insurance company and wants to fight the decision. Most likely, the owner will be referred to a lawyer who specializes in insurance. The lawyer will fight for the owner by showing the insurance company the wording in the policy that would indicate the owner is covered. If the company does not reverse its decision, and the owner has the time and resources to continue fighting, the owner will have to sue to get the money owed. (Bach says nine out of ten times owners settle for something less than what they should rather than going to court.)
Even if the lawsuit is successful, the insurance company will often appeal the decision. That’s where United Policyholders steps in. The organization will file a brief on behalf of the owner, which tells the appeals judge not to overturn the decision. In all, it has filed more than 250 briefs in over 30 states on behalf of owners, including several cases before the U.S. Supreme Court.
Despite all of Bach’s dealings with insurance companies, in the court room and on the front lines after a disaster, she says she doesn’t actually blame them for trying to short their clients. It’s all a simple matter of economics. “The insurance company has a natural tendency to cheat. It’s not that they’re evil; they’re business people,” she explains. “It’s a hardcore financial equation: the less they pay out to you, the more money they have. As long as that dynamic and tension is there, and it’s always gonna be there, there’s going to be a need for
what we do.”
That need was made even clearer to Bach after Hurricane Katrina. The disastrous event and the insurance industry’s lackluster response in helping distressed owners led to a national meeting of the country’s consumer advocates. Bach attended the conference and was startled to discover that the whole group could fit in one small conference room.
But rather than get disheartened, Bach says events like that only encourage her to work harder to provide United Policy Holders’ much needed advocacy and advice to as many people as it can. “There’s always a big need for what we do because no one else really does what we do, which is help solve insurance problems and advocate for integrity in the insurance system,” she says.
The opinions expressed in this article are those of the author, and do not necessarily reflect the viewpoint of the SFAA or the SF Apartment Magazine. Emily Landes is the managing editor of SF Apartment Magazine. Copyright © 2009 by Black Point Press. All rights reserved.