In search of profit, insurers have decimated their professional claims staff. They laid off experienced personnel and replaced them with young, untrained, unprepared people. A virtual clerk replaced the old professional claims handler.
Process and computers replaced hands-on human skill and judgment. Money was saved on the expense side of the business by paying lower salaries. Within three months of firing the experienced claims people gross profit increased. The accountants were happy. The quarterly profits increased. None of the happy people were insurance professionals. None of them understood how a professional claims adjuster saves the insurer by establishing a fair amount of loss, avoiding payment for items not lost or overvalued, and by avoiding losses for which no coverage was provided by the policy.
The promises made by an insurance policy are kept by the professional claims person. Keeping a professional claims staff dedicated to excellence in claims handling is cost-effective over long periods of time. A professional and experienced adjuster will save the insurer millions by resolving disputes, paying claims owed promptly and fairly, and by so doing avoiding litigation and claims of breach of contract and breach of the covenant of good faith and fair dealing.
The professional claims person is an important part of the insurer’s defense against litigation by insureds against insurers for breach of contract and the tort of bad faith. Claims professionals resolve more claims for less money without the need for either party to involve counsel. A happy claimant satisfied with the results of his or her claim will never sue the insurer.
Incompetent or inadequate claims personnel force insureds and claimants to public insurance adjusters and lawyers. Every study performed on claims establishes that claims with an insured or claimant represented by counsel cost the insurer more than those where counsel is not involved.
Prompt, effective, professional claims handling saves money for both the insured and the insurer and fulfills the promises made when the insurer sold the policy.
Insurers who believe they can handle first or third party claims with young, inexpensive, inexperienced and untrained claims handlers should be accosted by angry stockholders whose dividends have plummeted, or will plummet, as a result. When an insurer compromises on claims staff, profits, thin as they may have been previously, will move rapidly into negative territory. Tort and punitive damages will deplete reserves. Insurers will quickly question why they are writing insurance. Those who stay in the business of insurance will either adopt a program requiring excellence in claims handling from every member of their claims staff, or they will fail.
Insurance is a business. It must change — this time for the better — if it is to survive. It must rethink the firing of experienced claims staff and reductions in training to save “expense.” Insurers should, if they wish to succeed, adopt a program to promote excellence in claims handling that can help insurers keep the promises made by the insurance policy and avoid charges of breach of contract and the tort bad faith in both first and third party claims.
The Largest Residential Burglary of All Time
Post 5407
Fraud & the Fear of Bad Faith Suits
Posted on July 22, 2026 by Barry Zalma
See the full video at https://lnkd.in/gWQQEySW and at https://lnkd.in/gyhdK6wv
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the Perpetrators than any Other Crime.
After ...
Chutzpah is not Enough
Post 5397
Posted on July 20, 2026 by Barry Zalma
See the video and at https://lnkd.in/gNUs2XzT and at https://lnkd.in/g2MawyzX
Magistrate Issues a Search Warrant if there is a Fair Probability that Contraband or Evidence of a Crime will be Found in a Particular Place.
In United States Of America v. Frank Suess, et al., CRIMINAL No. 3:24-308, United States District Court, M.D. Pennsylvania (July 16, 2026) a federal grand jury indicted Frank Suess, Melissa Driscoll, and others in a 55-count health care fraud and anti-kickback prosecution arising from an alleged scheme involving medically unnecessary prescription “foot baths.”
As part of the investigation, the FBI obtained an August 19, 2022 warrant to search Driscoll’s Sterling Pharmacy Yahoo email account for emails from January 1, 2018 through December 31, 2020. Driscoll moved to suppress the resulting evidence, arguing that the warrant lacked probable cause, was overbroad, and rested on material misstatements and omissions.
LAW:
The ...
Fraud Shouldn’t Pay
Post 5396
See the video and at https://rumble.com/v7ctgmq-the-great-jewel-theft.html at https://youtu.be/aRbQ2sJfGwA
This is a Fictionalized True Crime Story of Insurance Fraud explaining why Insurance Fraud is a “Heads I Win, Tails You Lose” situation for Insurers. The story is one of a collection designed to help to Understand How Insurance Fraud in America is Costing Everyone who Buys Insurance Thousands of Dollars Every year and Why Insurance Fraud is Safer and More Profitable for the ¬¬¬Perpetrators than any Other Crime.
The Insured purchased, for the first time in his life, a policy of Personal Articles Floater Insurance (PAF) scheduling $125,000 worth of ladies jewelry. He advised the insurer that the jewelry was always kept in a class E safe at his residence. He also told the insurer that he was employed full time as the owner of a gasoline service station and that he had never been canceled or suffered a previous loss.
One month after the policy was ...
Fraudster’s Suit Fails and Defendant Stays in Jail
Posted on July 29, 2026 by Barry Zalma
It is Fraud to Sell Product Using Scripts Containing Half-Truths and Omissions
That Made the Plans They Sold Appear to Provide Broader Coverage Than They Actually Did.
Post 5413
n United States of America v. Steven Dorfman, No. 24-2275, United States Court of Appeals, Seventh Circuit (July 27, 2026) Steven Dorfman owned and served as CEO of Simple Health, a telemarketing company that sold limited indemnity healthcare plans by telephone. The government alleged that Dorfman and other executives directed sales employees to use scripts containing half-truths and omissions that made the plans appear to provide broader coverage than they actually did.
A jury convicted Dorfman of conspiracy to commit fraud, wire fraud, and mail fraud, and he appealed after the district court denied his post-trial motions.
BACKGROUND
Limited indemnity plans are designed to supplement — not replace — traditional forms of medical insurance. As ...
Failure to Immediately Offer Policy Limits not Bad Faith
Posted on July 28, 2026 by Barry Zalma
Since the Insurer Offered the Available Policy Limits and Jenkins Failed to Identify Evidence of Bad Faith, the Insurer Is not Liable for an Excess Judgment.
Post 5411
In Hal Jenkins; CLJ Healthcare, LLC v. Prime Insurance Company; Prime Holdings Insurance Services, Inc., d/b/a Claims Direct Access; David McBride; Evolution Insurance Brokers, LC, No. 25-4064, United States Court of Appeals, Tenth Circuit (July 21, 2026) April Jenkins died after liposuction surgery at CLJ Healthcare, LLC.
Her father, Hal Jenkins, pursued claims against CLJ and negotiated with CLJ’s insurer, Prime Insurance Company. Prime’s policy provided $50,000 in liability coverage per occurrence, reduced by defense costs. Prime later offered the remaining policy limits, but Jenkins rejected the offer.
CLJ subsequently assigned Jenkins its bad-faith claim against Prime and declined to defend the malpractice action, resulting in an uncontested $60 ...
Insurers Are Sufficiently Sophisticated to Write Any Exclusion it Desired
Posted on July 27, 2026 by Barry Zalma
Public Policy May Not Change Insurance Policy Wording
If Insurer Wanted to Exclude Charges of Sex Trafficking It Can Do So
Post 5410
In Samsung Fire And Marine Insurance Co., LTD, v. RI Settlement Trust; Ace Property And Casualty Insurance Company; Nationwide Mutual Insurance Company; Philadelphia Indemnity Insurance Company; Capitol Specialty Insurance Corporation, No. 61 EAP 2024, No. J-65-2025, Supreme Court of Pennsylvania (July 21, 2026).
The question presented was:
Does Pennsylvania have an “overriding public policy” against sex trafficking-as found regarding Schedule I controlled substances in Minnesota Fire & Casualty Co. v. Greenfield, 855 A.2d 854 (Pa. 2004), and as evinced by the state’s anti-trafficking law, 18 Pa.[C.S.] § 3011(a)- such that an insurer’s duty to defend and/or indemnify is abrogated when an insured is alleged to have enabled or profited from such ...
