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Bryant & Carson, P.C. July 27, 2013

To identify the worst insurance companies for consumers, researchers at the American Association for Justice (AAJ)undertook a comprehensive investigation of thousands of court documents, SEC and FBI records, state insurance department investigations and complaints, news accounts from across the country, and the testimony and depositions of former insurance agents and adjusters. Our final list includes companies across a range of different insurance fields, including homeowners and auto insurers, health insurers, life insurers, and disability insurers.

Allstate—The Worst Insurance Company in America

One company stood out above all others. Allstate’s concerted efforts to put profits over policyholders has earned its place as the worst insurance company in America. According to CEO Thomas Wilson, Allstate’s mission is clear: “our obligation is to earn a return for our shareholders.” Unfortunately, that dedication to shareholders has come at the expense of policyholders. The company that publicly touts its “good hands” approach privately instructs agents to employ a “boxing gloves” strategy against its own policyholders. In the words of former Allstate adjuster Jo Ann Katzman, “We were told to lie by our supervisors—it’s tough to look at people and know you're lying.”

The Insurance Industry’s Wealth

The insurance industry has so much excess cash it may spark a downturn in the industry. According to analysts at Standards & Poor’s, U.S. insurers are sitting on too much capital, and will likely endure at least three years of negative performance as a result.

The Ten Worst Insurance Companies

  1. Allstate

  2. Unum

  3. AIG

  4. State Farm

  5. Conseco

  6. WellPoint

  7. Farmers

  8. UnitedHealth

  9. Torchmark

  10. Liberty Mutual

The U.S. insurance industry takes in over $1 trillion in premiums annually. It has $3.8 trillion in assets, more than the GDPs of all but two countries in the world (United States and Japan). Over the last 10 years, the property/casualty insurance industry has enjoyed average profits of over $30 billion a year. The life and health side of the insurance industry has averaged another $30 billion. The CEOs of the top 10 property/casualty firms earned an average $8.9 million in 2007.