Los Angeles Injury Lawyer Blog

San Fernando Valley drivers who have been involved in accidents, who are insured with AIG probably have little need to worry about their coverage. The comfort should also go to all Southern California drivers who were injured when hit by a driver insured with AIG.

With the government bail-out of the troubled insurance company by lending it $85 billion dollars, AIG policyholders, and those entitled to compensation due to the negligence of an AIG insured driver will be protected. At least for now, the company remains solvent. AIG will sell off assets to service this new loan, and it is expected to survive this disaster.

With a 52 week high of $70.13, AIG's stock closed today at $2.05. Surely the company has a lot of rebuilding to do.

A Rhode Island Hospital has been fined for the 3rd instance this year of a doctor performing brain surgery in the wrong side of the patient's head. Last Friday, a chief resident started operating on the wrong side of an 82-year-old patient. In August, a similar error caused the patient's death.

These types of issues are not limited to Rhode Island as this issue is similar to battles we often face at Rice & Bloomfield. What is most frightening is that in Los Angeles, as in all of California, the most that could be recovered from litigation of this type of error is $250,000. From that amount must be paid litigation costs and attorneys fees. Because of that problem, many victims of medical malpractice often cannot find an attorney who will accept there case.

Although we are here to help people who have been injured, we must also make a living. We cannot continue to operate when faced with these type of limitations. This has become a common problem faced by injured patients throughout the state.

Presidential candidate Rudy Giuliani has frequently trumpeted Texas and California as models for providing access to health, citing an example of a doctor who moved from Maine to Texas and had his malpractice insurance premium reduced from $11,300 to $5,031. There is no evidence to tie the premium difference to the medical malpractice cap. Moreover, I find it hard to believe a doctor moved to Texas to save $5,000 per year. That amount would not even cover his moving costs.

Mitt Romney has joined in the insurance industry created hysteria about insurance premiums. He talks about the burden imposed by lottery-sized awards. However, he ignores the incredible burden put on a family who loses a loved one due to a doctor's neglect. Democratic hopeful John Edwards, a former trial lawyer, explains that the cap has little effect on premiums (less than 1%).

We feel that most doctors can certainly afford $11,000, instead of $5,000 to make sure that anyone they hurt is taken care of. I expect most doctors would prefer to make sure people hurt by medical errors are provided for. It is the insurance companies that do not want to take care of people.

Last Thursday, the state slapped Health Net, Inc. with a $1 Million fine. Ironically, Health Net is our neighbor here in Woodlands Hills although our only connection with them is in representing insureds with claims against them.

The insurance company set goals for cancellation on policies and paid bonuses to employees based on how many policies the dropped and how much money that saved the company. The penalties help shed light on the way insurance companies work. While they spend millions of dollars on commercials to make people think their goal is to help, these types of incidents show how insurance companies really work. Unfortunately, trusting your insurance company may be a mistake.

The fine came after the company mislead state investigators about bonuses paid to employees on more than one occasion. The fines resulted from the insurance company not be straight forward in response to the investigation. As we have found to be the case on many occasions with insurance companies, what they tell you they are going to do, does not always match what they actually do.

Basically, when a Health Net insurance employee found people who were sick, and made large claims and cancelled them, Health Net rewarded them. Health Net was able to find the people that needed protection the most, and hurt them. In one case, Health Net left an insured stuck with nearly $200,000 in medical bills.

As insurance companies always have an excuse for their conduct, Health Net claimed that the cancellations were necessary root out fraud and keep premiums down. It appears that it did so by committing fraud.

The fine is one of the largest in the history of the Department of Managed Care.

Many Southern California families suffered the horrifying loss of their homes in the recent Los Angeles, Orange, and San Diego wild fires. Nearly 1,500 homes have been destroyed and hundreds more have been damaged. The process of adjusting homeowners' claim will now begin with insurance companies working hard to limit how much they pay.

Insurance companies will be quick to pay for a coat of paint, but often will not do the necessary investigation to search for all of the damage a fire can cause. Especially where a home is left standing, smoke damage is often not detectable to the average person. While some people will simple settle with their insurance company for the damage which is easy to see, with the assistance of an attorney or other trained professional, a homeowner can obtain the comensation they are entiteled to receive.

It is estimated that the loss from the October fires will be about $1 billions dollars. While this may seem like a huge loss to the insurance industry, when compared to the $450 billion in policy sales last year, and the record $65 billion in profits, the loss if fairly minimal.

Many families suffered huge financial and emotional losses over the past week. They should not have to haggle with the insurance companies to obtain the compensation they paid for over the years with their premiums.

We all pay for it - for our lives, health, home and automobiles. If we add it all up, paying for insurance takes a huge bite out of our earnings and every year that bite seems to be getting bigger while the benefits of coverage are shrinking. It isn't your imagination. The insurance industry is racking up record profits and paying less in claims.

Recently, the Consumer Federation of America (CFA) accused the country's largest insurers of "gouging" the public on their way to an estimated combined after-tax profit of nearly $60 billion in 2006, up from a record in 2005 of $48.8 billion, which shattered the 2004 record of $40.5 billion. Meanwhile, the amount of premiums being paid out to insureds for claims has dropped from about 75% in the late 1980's to 60%.

To add insult to injury, the federal government has subsidized the insurance industry to the tune of about $7 billion under the Terrorism Risk Insurance Act. The CFA is urging Congress to let the Act expire at the end of this year.

The insurance industry often cites trial lawyers and the clients we represent as the source of rising premiums. Clearly, this is not the case. The apparent cause of rising premiums, at least as far as homeowners' and auto insurance is concerned, is greed and the unchecked power of big insurance companies. This may be good for shareholders, but it is an increasing burden on the middle class and a problem that needs to be addressed through tighter regulation.

For more information, please go to: http://www.insurance.ca.gov/0400-news/0100-press-releases/0070-2006/upload/Lowerclaimshigherprofitsreport.pdf