Negotiating with an insurance company is understandably uncomfortable and intimidating. No one is at their best after an accident. Every insurance claim attorney in Gig Harbor realizes that being in an accident is traumatic, turning one’s life upside down.
How Insurance Companies Make Money
Insurance companies typically make money in two ways: underwriting income (premiums) and investment income.
- Underwriting Income: The premiums that policyholders pay to insurance companies are underwriting income. The goal of the insurance company is to receive more money in premiums than they pay out to cover claims. Insurance companies are always focused on maximizing revenues by paying out as little as possible on every claim.
- Investment Income: Insurance companies receive huge sums of money from premiums and are allowed to invest money that is not being used. For example, Warren Buffet founded the Berkshire Hathaway Insurance Company primarily to generate funds to use for stock market investments. In the past, insurance companies have sometimes charged too little for policies simply to receive premiums that could be invested. Of course, not all investments make money. Losses in the stock market can result in premium rate hikes.
How This Affects Your Claim
Insurance adjusters are focused on paying as little as possible for each claim. Remember that the adjuster probably handles more claims in a single day than the average person submits in a lifetime. Their training causes them to try to obtain answers that will undervalue the claim. Being empathetic and reassuring is more likely to result in a reduced payout. As the potential dollar value of the claim rises, more experienced and aggressive adjusters and lawyers will be assigned to the case.
Insurance Companies Know Claims are Higher When the Accident Victim has an Attorney
The insurance industry’s own Insurance Research Council found that accident victims who hired an attorney tended to receive significantly higher payouts than those who handled the claims on their own. Experienced attorneys can separate the truth from the lies and know how much their client is entitled to. They aren’t confused by vague statements and deceptive negotiating tactics.
Don’t try to handle the insurance company by yourself. Contact Otto Law Offices and let an experienced Insurance Claim Attorney in Gig Harbor fight for you and protect your rights. This expert attorney has over 36 years of trial experience and knows how to get you the compensation that you deserve.
