The Florida First District Court of Appeal upheld the Florida Office of Insurance Regulation’s suspension of Allstate writing any new policies in an opinion issued last Friday. Allstate had refused or was slow producing documents to the Department as it investigated Allstate’s role in duping Florida legislators and regulators into passing legislation which should have resulted in lower rates. This was an important legal decision and the news media picked up on it right away. (Boston Globe; Tampa Tribune; Chicago Tribune) Within hours of the decision, Allstate placed over 150,000 previously "secret" documents regarding its claims practices on the Web Friday night.
I was returning late Friday night to Tampa from Mississippi. I received a call from a journalist asking about my perceptions of the Appellate Court ruling and was informed of Allstate’s actions. I was in disbelief that after all these years of Court battles, appeals, flying all over the country for snippets of these documents, that Allstate finally was turning them over and placing them on the internet for all to see.
These are documents we have long sought the disclosure of for over a decade. The National Law Journal incorrectly noted that I was the point person for the policyholder’s bar organizing a coordinated effort to obtain these documents. (Mark Ballard, "Allstate’s Master Plan?", Natl. L. J., November 9, 1998, at A1, Col. 2) So, after thirteen years of trying, it was satisfying that these documents were finally released to the public for scrutiny.
How insurance companies handle insurance claims should neither be a mystery nor a secret. I cannot fathom a societal reason why we should allow them to be. Keeping them secret simply encourages cheating insurance company practices. If there is a "cheaper" and more efficient method to adjust claims, all of us should benefit by sharing that information since all of our claims in aggregate have an effect on rates. I wrote an editorial in the Tampa Tribune suggesting that the time was right for Florida to treat cheating and arrogant insurance companies with an "iron fist." Insurance Director McCarty did just that when his office handed Allstate the suspension. Now, everybody benefits. Even Allstate and the insurance industry will benefit from this in the long run, although I do not expect them to say so publicly.
