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CNN Starts Weeklong Attack on Insurance Companies
Business & Media Institute ^ | August 28, 2006 | Ken Shepherd

Posted on 08/28/2006 1:52:14 PM PDT by freemarket_kenshepherd

With a tropical storm threatening Florida and the one-year anniversary of Katrina approaching, CNN’s August 28 “American Morning” kicked off a weeklong look at “Red Tape and Rubble” in the Gulf Coast. But Ali Velshi’s first report in the series was unbalanced, treating insurance companies as guilty until proven innocent of greed or fraud.

“We’re going to be there when you need us,” anchor Soledad O’Brien said is the promise insurance companies extend out to policy holders, “But many Katrina victims think uh, uh, that’s not true,” she complained.

O’Brien set the stage for Velshi’s unbalanced report by painting insurance companies as “trying to get off easy” as compared to customers who probably “didn’t understand their policies.”

Velshi did show an insurance industry spokesman to point out that private homeowners insurance plans have never covered flood damage from any cause, including hurricanes. Dissatisfied with the argument that homeowners have a personal responsibility to obtain separate flood insurance, Velshi turned to Mississippi trial attorney Richard “Dickie” Scruggs, who attacked the industry for making a profit.

Altogether, the five companies Scruggs is suing on behalf of hurricane victims “reported profits of more than $12 billion last year,” Velshi complained, adding that 2005 was “the insurance industry’s most profitable year ever” even after “record policy payouts.”

But rather than finding someone who would argue the insurance industry’s health amidst “record payouts” is good news for the economy and for the vast numbers of insurance claims paid out to hurricane victims, Velshi ended his story complaining that “it wasn’t a profitable year for Cecil Tillman,” a man suing his insurance provider, Nationwide (NYSE: NFS).

What’s more, Velshi’s focus on “record profits” is misleading, according to an industry spokeswoman who talked to the Business & Media Institute recently.

(Excerpt) Read more at businessandmedia.org ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: alivelshi; americanmorning; cnn; disasters; flooding; floods; hurricanekatrina; insurance; soledadobrien

1 posted on 08/28/2006 1:52:16 PM PDT by freemarket_kenshepherd
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To: freemarket_kenshepherd

'Oh THAT little clause,,well I didnt read that!!"


2 posted on 08/28/2006 1:55:41 PM PDT by samadams2000
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To: freemarket_kenshepherd

i think cnn is despicable. it's hard to say if I think less of the insurance industry.


3 posted on 08/28/2006 1:56:46 PM PDT by the invisib1e hand (hack for liberty.)
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To: freemarket_kenshepherd

Who in the 9th Ward HAD insurance?


4 posted on 08/28/2006 1:56:50 PM PDT by BigTex5
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To: freemarket_kenshepherd

My mom was recently screwed by Allstate and they are still trying to get out of paying her. Their Utah management is corrupt, for sure.


5 posted on 08/28/2006 1:57:22 PM PDT by Sunsong
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To: Sunsong

My mom was recently screwed by Allstate and they are still trying to get out of paying her
how so? - she should go to her Dept of Insurance for asst.


6 posted on 08/28/2006 1:59:37 PM PDT by SF Republican
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To: samadams2000

It simple! Either you had wind and flood insurance or you didn't. I live on a hill, I have insurance for wind but not for a flood. If I get flooded it's my fault!!


7 posted on 08/28/2006 2:01:05 PM PDT by navysealdad
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To: freemarket_kenshepherd

Typical CNN agenda driven massive deceit.


8 posted on 08/28/2006 2:01:12 PM PDT by FormerACLUmember
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To: freemarket_kenshepherd

When will CNN be doing a week long series on why their Katrina coverage was so inaccurate?


9 posted on 08/28/2006 2:01:58 PM PDT by Moral Hazard (The "missing links" in evolution are nothing compared to the extraneous links in intelligent design.)
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To: freemarket_kenshepherd
Sorry. I used to have some sympathy for insurance companies. But when they told me they were canceling my windstorm coverage during the heart of Hurricane season down here, I lost it. I am in an area that hasn't had a direct hit in 35 years. They changed the term date to November, but that's BS they do that to you even if you have not had one claim against them.
10 posted on 08/28/2006 2:03:11 PM PDT by The South Texan (The Democrat Party and the leftist (ABCCBSNBCCNN NYLATIMES)media are a criminal enterprise!)
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To: the invisib1e hand
i think cnn is despicable. it's hard to say if I think less of the insurance industry.

Well put.

11 posted on 08/28/2006 2:04:05 PM PDT by TChris (Banning DDT wasn't about birds. It was about power.)
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To: freemarket_kenshepherd

If the insurance companies are as honest as they claim, they shouldn't mind being the focus of additional scrutiny.


12 posted on 08/28/2006 2:04:11 PM PDT by mysterio
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To: freemarket_kenshepherd

Why does this media continue to protect bankers and lawyers?


13 posted on 08/28/2006 2:06:42 PM PDT by <1/1,000,000th%
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To: freemarket_kenshepherd

This must be the beginning of the MSM ad campaign for Michael 'Fat-A$$ed' Moore's upcoming mockumentary.


14 posted on 08/28/2006 2:07:21 PM PDT by Hayzo
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To: Sunsong

You mean Allsnake?


15 posted on 08/28/2006 2:11:02 PM PDT by Vasilli22 (http://www.richardfest.blogspot.com/)
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To: <1/1,000,000th%

I have a strong feeling the insurance deserve whatever they get. They're not exactly pure as the wind driven snow either.


16 posted on 08/28/2006 2:14:43 PM PDT by ark_girl
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To: BigTex5

Fats Domino, for one. Many, many people in the 9th Ward were hard working people who owned their homes and yes, *gasp* even had insurance!


17 posted on 08/28/2006 2:15:51 PM PDT by Ima Lurker
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To: freemarket_kenshepherd
From the article:
“Two of the last 28 years we’ve actually made money,” Rochman said, referring to underwriting income – meaning the industry takes in more in premiums than it pays out in claims. In fact, she added, “Last year in Mississippi and Louisiana, the insurance industry paid out the equivalent of about 20 years’ worth of profits for those states.”

Been losing money for 3 decades? I think I just exceeded my Recommended Daily Allowance of Bull***t today.
18 posted on 08/28/2006 2:15:57 PM PDT by kinoxi
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most people do not understand how insurance works under the law of large numbers....the coverage from flood is not on homeowners policies...the individuals must choose to purchase separate coverage through private companies that might write the coverage or through government programs (national flood programs. It is always very simple after a loss to blame everyone else ( the democraptic mantra), that it was not explained or the individual did not understand that the coverage was not there if not purchased! Under the law of large numbers, insurance companies will spread the risk among a large number of similar potential victims to promulgate rates and premiums...if the pool is too small or very high in potential catastrophic exposure..the premiums will be high..that is when people such as the katrina victims would choose not to purchase the insurance...it is much easier to blame everyone else and in the end...of course, it is Bush's fault....but for everyone else, be very concerned...1) tax $$$'s will bail out these "victims" to be pc 2) referring to that law of large numbers...all others will pay higher costs in the future!!!...kind of what piaps and the dems have in mind for all middle class tax payers come 01/01/2009!!!!!


19 posted on 08/28/2006 2:20:03 PM PDT by hnj_00
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To: freemarket_kenshepherd

First of all, the "O'Briens" can never be relied upon to report the facts, and the facts only. They always seem determined to 'emphasize', 'stress', 'slant' and 'proclaim.' However, for the record: Insurance compainies always seek to underpay claims; claiments always seek to inflate claims. Ergo, compromise is often the only fair measure.


20 posted on 08/28/2006 2:20:37 PM PDT by Continental Soldier
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To: freemarket_kenshepherd

21 posted on 08/28/2006 2:26:46 PM PDT by TheSpaceCoyote
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To: kinoxi
LOL! Well put. If you owned a business that had lost money for that long you'd either be bankrupt or you'd be an idiot to continue running it. Now they have to raise their rates 68 % to actually make a little profit donchaknow?
22 posted on 08/28/2006 2:27:53 PM PDT by Normal4me
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To: freemarket_kenshepherd

CNN is proterrorist and antiamerican as they come. By comparison insurance companies are operated by saints. I have worked as a consultant for a couple of insurance companies and numerous agents. My impression; most agents are a reasonable group of people--they attempt to do the best with the information they have. I have not seen an agent trying to cheat a claimant. On the other hand, insurance fraud is rampant -- I have seen numerous people, who feign honesty, attempt insurance fraud and feel justified in doing so. The absolute worst: there are a gazillion shyster lawyers out there making a living ripping off insurance companies.


23 posted on 08/28/2006 2:29:45 PM PDT by Neoliberalnot
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To: SF Republican

The Utah Insurance Comm claims there is nothing they can do. She has had to take it through small claims court - has won - but Allstate is still appealing.[ She says they are trying to wear her down or hoping she dies :-)] Their dishonesty is appalling! And their lack of concern for a customer who had been with them for 18 years - never having made even one prior claim is disgusting, imo.


24 posted on 08/28/2006 2:39:58 PM PDT by Sunsong
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To: Vasilli22
You mean Allsnake?

smile

25 posted on 08/28/2006 2:41:10 PM PDT by Sunsong
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To: freemarket_kenshepherd

Since they find insurance companies so offensive, maybe insurance companies should relieve CNN of the burden of hypocrisy by revoking all insurance company advertising from CNN networks and also by canceling their insurance policies.


26 posted on 08/28/2006 2:47:23 PM PDT by MikeA (Not voting out of anger in November is a vote for Nancy Pelosi as Speaker of the House)
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To: navysealdad

It simple! Either you had wind and flood insurance or you didn't. I live on a hill, I have insurance for wind but not for a flood. If I get flooded it's my fault!!


Unless your a minority and in New Orleans.


27 posted on 08/28/2006 3:05:10 PM PDT by bikerman (Democrats the cut and run party.)
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To: BigTex5
Who in the 9th Ward HAD insurance?

That's an ignorant question. A majority of Ninth Ward residents were homeowners, many of them elderly folks who owned their homes free and clear and had insurance. This neighborhood was poor, but it was not a "ghetto" full of slum apartments and public housing.

The insurance companies have absolutely raped those folks in New Orleans. If you go there you will see house after house, completely ruined, with signs saying "Allstate paid me $3,500 for this." There was a man featured in the Spike Lee documentary who was a WWII veteran and had paid insurance premiums for 55 years on his home, which was ruined. His insurance company said they would pay $750 for some roof damage! He has paid probably ten times that in premiums. This is how our aging veterans are treated today by Corporate America.

And by the way, whatever the insurance companies refuse to pay, YOU are picking up the tab as the government is starting to hand out $150,000 grants to everyone in New Orleans with uninsured losses.

I hope the insurance companies get the biggest black eye in business history out of this.

28 posted on 08/28/2006 3:08:53 PM PDT by Dems_R_Losers (Meet the new dictators of America.....Bill Keller, James Risen, Eric Lichtblau, and Dana Priest)
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To: Dems_R_Losers

Its not an ignorant question if you truely don't know the answer. It wasn't racist or derogatory in any matter. What they keep saying on the news is that the 9th ward was the poor part of the city. The majority of the poor people can't afford home owner's insurance.


29 posted on 08/28/2006 3:13:59 PM PDT by BigTex5
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To: freemarket_kenshepherd

Congratulations freemarket- there isn't a sympathetic party in this entire scenario.


30 posted on 08/28/2006 3:27:12 PM PDT by fat city ("Journalists are sloppy, lazy and on expense account")
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To: Dems_R_Losers

"The insurance companies have absolutely raped those folks in New Orleans. If you go there you will see house after house, completely ruined, with signs saying "Allstate paid me $3,500 for this." There was a man featured in the Spike Lee documentary who was a WWII veteran and had paid insurance premiums for 55 years on his home, which was ruined. His insurance company said they would pay $750 for some roof damage! He has paid probably ten times that in premiums. This is how our aging veterans are treated today by Corporate America"

I'm an aduster for Allstate and worked in New Orleans in the aftermath of Katrina. I lived in a pop up camper for the first month I was there, with no running water and only sporatic electricity. many other adjusters lived and worked in as bad or worse conditions for the first few weeks..... some commuted from out of town hotels up to a 100 miles each way every day, 7 days a week.

I didn't see my family for 4 months and worked 17-18 hour days, 7 days a week.

Allstate's only instructions to all of us was make sure every policy holder gets every dime they have coming but not a nickel more.

If you had insurance for 100yrs and didn't have flood insurance you didn't get paid for flood damage period. You don't get paid for what you're not covered for, it's that simple.

And FEMA underwrites and regulates how flood insurance claims are paid, NOT the insurance companies.

Insurance companies only market the flood policies on FEMA's behalf.

VERY FEW people who had flood damage in the N.O. area didn't have flood insurance. I settled over 350 claims and only had 5 who suffered flood damage with no coverage...

Out of all those claims, I had exactly 8 complaints from customers who thought that their settlement was not "enough" 2 of those were claiming damage that didn't occur and the other 6 didn't have "replacement cost" coverage.... so their claim was settled based on depreciated value...

I had over 20 customers who attempted to file for damage that was not caused by the storm, or claimed damage to items that we could not determine that they ever owned.... in other words, attempted fraud.

It's easy to look at some elderly or poor person and feel compassion for their plight..... that doesn't in any way mean they're owed something by an insurance company.

My own homeowners premium has more than doubled..... as I also live in a Hurricane prone area that's been hit on more than one occaision in the past 10 years, including Ivan and Katrina.

There's two sides to every story....99% of the folks complaining have only themselves to blame for their predicament. They didn't buy flood insurance or they built expensive homes in a flood zone (max payout on flood insurance is $250,000 on structures and $80,000 on personal property... so if you had a $500G home that was destroyed by storm surge, you're out of pocket at least $250G) Those are FEMA limits..... they sell the insurance not the insurance companies.


31 posted on 08/28/2006 3:43:26 PM PDT by adjuster
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To: freemarket_kenshepherd

This is consistent with CNN being a wholly-owned subsidiary of the Democratic Party. Democrats implement anti-business legislation in hopes of getting more donations from business. CNN probably implements anti-business programming in hopes of getting more advertising -- and public service announcements -- from the insurance industry.


32 posted on 08/28/2006 4:02:31 PM PDT by AZLiberty (Creating the <a href="http://clinton.senate.gov">straddle</a> Google bomb one post at a time.)
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To: freemarket_kenshepherd

Well I don't live in a flood zone, or a wildfire area, or a landslide region.

People that live against brush on hills or close to the water tend to be quite wealthy, with the possible exception of many residents of New Orleans. I have little sympathy for them, and even less desire to see a taxpayer bailout, bankrupt my insurance company, or see my rates go up, because they choose to own/build a home in a foolish location or don't understand their policies.

Wakeup people. Your homeowners insurance covers fire/wind damage, certain kinds or theft, and protects you from liability, and that's it unless you have some kind of rider.


33 posted on 08/28/2006 4:04:40 PM PDT by Smogger (It's the WOT Stupid)
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To: freemarket_kenshepherd

Its about time somebody investigate them!Insurance is where you pay for thin air.At least the tobacco industry gave you a butt and some smoke!The insurance companies have managed to have laws passed which guarantees them an income and if you don't pay they turn you in.A law should be passed that says they HAVE TO PAY if your premiums are current.


34 posted on 08/28/2006 4:28:05 PM PDT by INSENSITIVE GUY
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To: adjuster
BTTT

Thanks for the honest look from an inside perspective. Typically these threads devolve into sniping at insurance companies backed by anecdotal evidence.

35 posted on 08/28/2006 4:40:21 PM PDT by been_lurking
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To: Hayzo
This must be the beginning of the MSM ad campaign for Michael 'Fat-A$$ed' Moore's upcoming mockumentary.

IMHO you've hit the nail square on the head. Time will tell, but if I were a betting woman...

36 posted on 08/28/2006 5:01:14 PM PDT by yankeedame ("Oh, I can take it but I'd much rather dish it out.")
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To: ark_girl

But they don't make nearly the money that bankers and lawyers do.


37 posted on 08/29/2006 9:17:30 AM PDT by <1/1,000,000th%
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