Auto Insurance general question

by Brenda
(Los Angeles, CA, USA)

Why is it that insurance companies can get away with "their loopholes," causing everyone to have to get lawyers to know their rights?

It seems like a scam to me.

There are laws that force people to have to buy and pay hard earned money for insurance, but then insurance companies, being specialists, know the laws and use it to their advantage. The one's paying their paycheck have to spend even more money to get lawyers to make insurance do what it promised to do.

And in a car accident, unless you're hurt, attorneys usually don't want to deal with the property damage.

How can this be legal? Why don't governments help the consumer and pass laws that will keep insurance from being able to (basically) lie to people?

Or is this too general of a question?

I've always wondered how insurance gets away with these things.

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Answer

Brenda, Thank you for your submission,

There is on question that insurance companies have a positive effect. In fact, do you know what the #1 task of the insurance commissioner of each state (or director of the department of insurance)?

To make sure that the insurance company makes money. Yeap, not to protect the consumer but to ensure that the business of insurance is a profitable one.

Say what? yeah, the theory is that without insurance companies, or if they leave the state, then no one can get coverage.

I think this shows at the very least that insurance companies are very powerful. They are a multibillion dollar industry. They can afford lawyers, politicians, TV ads, political campaigns, and just about every thing else.

They get away with things because they lobby the government. Most states (except for Montana which really protects the consumer), have drafted legislation to protect the insurance carrier.

Maybe we should make the issues of insurance an election issue.

Thank you for your question.

Héctor.