A death and dismemberment insurance agent grew alarmed when he saw the volume of claims begin to rise in an area of Southern New Jersey. His alarm grew to suspicion when colleagues from a neighboring firm mentioned the same phenomenon. Upon investigation, he discovered that a “clan” of local men had devised an interesting system. The group would purchase individual policies through twenty or thirty different agencies and then, occasionally, sever each other’s fingers. Each claim paid as much as $5,000 per digit.
There are a million stories like this across the insurance industry, and while they are great fodder for cocktail hour they also eat a big hole in company budgets. Inventor Toby Unwin is hoping to change all of this. “It occurred to me that this is a data problem”, he says, and that revelation sparked an idea. What if all of the court cases across the globe were finally searchable from one database?
Several years later the database not only exists it is available to any paying client. The chart below is a product of Unwin’s newly patented system Premonition, and it’s the first published record of lawsuits filed against some of the biggest hitters in the insurance business.
|Geico General Insurance Company||7665||234||45.04|
|Allstate Insurance Company||2064||262||67.54|
|Citizens Property Insurance Corporation||1902||328||89.78|
|Florida Peninsula Insurance Company||794||555||60.96|
|Government Employees Insurance., Company||791||337||60.45|
|Direct General Insurance Company||742||92||94.43|
|Heritage Property & Casualty Insurance Company||525||484||62.22|
|21st Century Centennial Insurance Company||472||127||88.10|
|Infinity Automobile Insurance Company||407||180||88.49|
|Automobile Owners Insurance Company||400||137||77.39|
|American Security Insurance Company||298||347||72.73|
|Esurance Insurance Company||295||135||85.85|
|Infinity Indemnity Insurance Company||248||199||69.85|
|American Family Mutual Insurance Company||243||127||58.48|
|Garrison Property and Casualty Insurance Company||196||126||71.64|
|American Integrity Insurance Company of Florida||176||189||69.62|
|Farm Bureau General Insurance Company of Michigan||176||140||74.67|
|Interinsurance Exchange of the Automobile Club||146||248||59.05|
|Amica Mutual Insurance Company||143||103||84.04|
|Ids Property Casualty Insurance Company||137||162||78.41|
Geico topped the list with 7,665 cases over a two-year span. The average case lasted 234 days and they won just 45.04% of the time. By comparison, Allstate, one of Geico’s largest competitors, had 2,064 cases over the same time period. Allstate’s average case lasted for 262 days and they won 65.74% of them. Direct General Insurance Company gave the best legal performance winning close to 95% of their 742 cases and averaging only 92 days per case.
“Madoff had a string of civil litigation cases before he was uncovered. This happened because people were simply unaware of it.” Says Unwin. Unwin and his partners plan to use data mining to bring transparency to an area that has been traditionally murky for consumers. From insurance claims to the performance of an individual attorney, the Premonition system has all the potential to do just what its founders have promised, “To disrupt the field of law”.
Source: Business Insurance