The modus operandi of the insurance companies is to invest the premiums collected from the customers and then they hope that the claims are less than the investment value. The clients who file for a claim with an insurance company have to face a tricky situation due to the following reasons:
The employees of the insurance company commit fraudulent practices to evade claims made by the clients. This includes deliberately corrupting the customer data. Errors are crept into the data processing system in order to corrupt the medical declarations. This makes it impossible for the clients to make a claim.
In many insurance companies the employees are given special instructions to evade each and every claim made by the clients on whatever grounds they deem best.
If the claims cannot be avoided in any way then the employees are supposed to increase paper work to such an extent that the policy holder gets frustrated and leaves.
This makes it amply clear that the insurance companies have a self interest of not paying claims. They receive a plethora of claims daily but they conveniently deny most of them by hook or by crook. People generally do not dispute their claims which give a huge profit to the insurance companies.
The insurance companies can act in bad faith in the following ways:
They are unable to swiftly and comprehensively investigate a claim.
They make unfair delays in the payments to the policy holder.
Ironically, the insurance companies are quite pleased with the dishonesty of their employees who are complicit with their fraudulent practices. Such employees are offered perks.
However, it would not be fair to blame only the insurance companies for defrauding the policy holders. The latter are also not free from guilt. I shall discuss about the fraud committed by the policy holders in my next post.
Keep Me In Your Prayers.