Insurance Companies Will Suffer If There Is More Compensation, Which There Will Be If There Are More
No doubt you have noticed all the lawyers' advertisements that are everywhere
from the television, in the phonebook, or on billboards that line the roadways. Hurt in an accident? Car Crash or whiplash? We can help! You will find no shortage of advertisements that depict people on crutches, horror stories of surgeries, and the lawyers that come to their rescue offering free services unless you get paid. You can even find some of these services who will offer you a short term loan until you get your compensation.An insurance bureau says this strong advertising campaign created by personal injury lawyers is one of the factors contributing to the rise of claim costs. Some insurance companies have cited these rising costs as the reason they must stop selling insurance to motorists. Basically, the ratio of minimal damage to huge claim for the accident is seeing insurance rates go up, and the fact that they get the large rewards most of the time isn't helping. While the insurance industry as a whole believes in paying for injuries received in an accident, this bureau agent says that the expectations of consumers have gone to extremes.
Each company has had to implement its own level of premium cost increases due to the runaway damage claims. The typical rise in cost for drivers at an average risk level ranges from 15 to 35 percent. If you have been involved in an accident or have received a ticket in the last few years, the increase you will see is going to be even greater than that.
The increase in claims costs being connected with the lawyers advertising is being disputed by the personal injury lawyers. A particular attorney stated that he cannot fathom the link made by the insurance industry group between claim totals and law firm promotional materials. If someone gets hurt in an auto accident, they have every right to make a claim against the third party driver. However, bar authorities are pondering whether it is ethically appropriate for attorneys to offer financial advances to plaintiffs they are representing.
One lawyer agrees that there is a proliferation of advertising by personal injury lawyers and that this may actually increase the number of claims filed. He doesn't see a problem with this increase. It's unfortunate that the insurance bureau finds the fact that lawyers are telling people about their rights and how to go about asserting those rights. He notes that insurance costs are increasing and that the system could be improved. He also says the insurance industry isn't willing to work with his association to make the needed changes.
It is the opinion of one bar association president that those in the insurance business are going about reducing claim costs the wrong way. Instead of blaming lawyers, they should focus their efforts on accident prevention. According to him, the industry isn't exactly beating down government's door to ban cell phones while driving or make fines for photo radar more lucrative. Also, he is curious was to why the insurance companies aren't lobbying for better road safety and more legislation to prevent accidents instead of pestering lawyers. Also, the insurance industry has suffered with its investments; this has drastically reduced its profits.
Legislation to prevent double dipping by people who have been injured in a motor accident is being fought for by the insurance industry. Certain claimants seek awards for lost wages in situations where they have already received compensation under their existing employee benefit coverage. Even more egregious is the fact that such compensation is paid based on gross pay, rather than net pay which has had tax withheld. This makes it harder for the employee to want to go back to work. The greater the delay in returning to work, the greater the compensation you will receive.
The number of personal injury lawyers is unknown and many lawyers don't think that places for these lawsuits has increased. For the most part, they just let motorists get pain and suffering money, and only then it's due to real, serious, crippling injuries. While the insurance industry blames personal industry advertising for the increase in claims, it may be the opposite that is true. After all, it is well within a lawyer's right to hold off on payment until a settlement is one. It is also acceptable to absorb the costs of litigation if a client should lose.
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