Unum Named Second-Worst Insurance Company in US

Chattanooga, TNIt may come as no surprise to some people who deal with companies like Unum that Unum is listed as the second-worst insurance company in the US. Unum lawsuits, alleging the company engages in bad faith insurance practices regarding Unum disability claims, have been filed against the company. In 2012, the American Association for Justice (AAJ) included Unum on its list of 10 worst insurance companies.

In the report, “The Ten Worst Insurance Companies In America,” the AAJ lists Unum second, behind Allstate and ahead of AIG, State Farm and other insurance companies. In its write-up of Unum, the AAJ notes that the company “has long had a reputation for unfairly denying and delaying claims. Unum’s claims-handling abuses have consistently been the subject of regulator and media investigations.”

Among allegations against Unum are that the company told employees to deny claims to meet cost-savings goals. In California, according to the AAJ, approximately one in four claims for long-term care insurance was denied, resulting in an investigation by the California Department of Insurance. That investigation reportedly uncovered widespread fraud committed by Unum, including violations of state insurance regulations, use of phony medical reports to deny or underpay claims and investigations that were biased.

And even though in 2005, Unum agreed to reopen more than 200,000 cases, in 2007, it had reviewed only 10 percent of the cases that were eligible for review. In one lawsuit, Unum allegedly told a policyholder that he was not disabled and could work, despite his having had a quintuple bypass surgery.

Among tactics allegedly used by insurers to unreasonably delay or deny insurance claims: arguing the policyholder had a pre-existing condition, even if that condition is not linked to the one being claimed; refusing to acknowledge certain disabilities, such as Fibromyalgia; ignoring professional medical diagnosis or using biased experts; changing policies after a claim is filed; and claiming a person is not disabled and can work, despite a medical diagnosis from a professional.

Such tactics fall under bad faith insurance, and if an insurer has committed bad faith insurance, policyholders whose claims have been improperly or unreasonable denied or delayed may be eligible to file a complaint against the insurance company.