In my last blog, I discussed some of the major weaknesses of Farmers Insurance’s new policy. In sum, it is a terrible policy that I could never recommend to anyone in good conscience.
Unfortunately, they aren’t the only low-end policy out there. This week, I’d like to discuss whether Allstate is a good insurance company.
Is Allstate A Good Insurance Company?
According to their website, “[Allstate] is the largest publicly held personal lines…insurance carrier” in the US. They are huge. They advertise constantly, and they have one goal in mind, get any many people to sign up as possible.
The problem with Allstate’s business model is, as soon as a person signs up for coverage, they become nothing more than a risk. They have a history of handling claims poorly, oftentimes leaving innocent victims without the coverage they need, or the support they expected from their insurer.
I could go on forever about the number of clients who have contacted Wheeler, DiUlio, & Barnabei for help after being neglected by Allstate. But for now, let’s just focus on their homeowners insurance policy.
With Allstate, You Really Aren’t ‘In Good Hands’
Here are some of the major weaknesses in Allstate’s policies, which you won’t find in other insurance policies:
1. Sudden and Accidental Damage
Allstate’s coverage language states that they “…will cover sudden and accidental direct physical loss to the property….” One very small yet very major word is added into this phrasing which results in a denied claim far too often: the word “and.”
By adding the word ‘and’, Allstate is only required to cover your loss if the damage is both sudden and accidental.
Most other policies don’t require both sudden and accidental. For example, State Farm only requires “accidental direct physical loss”. Erie’s policy uses the language that they cover “direct physical loss”.
As you can imagine, fewer requirements to the type of damage covered makes coverage easier – leaving you better protected. It’s amazing how one seemingly insignificant word can mean a world of difference.
2. Continuous or Repeated Seepage for Weeks, Months, or Years
One of the exclusions in Allstate’s Policy states that “…seepage, meaning continuous or repeated seepage or leakage over weeks, months, or years is of water, steam, or fuel…” is not covered.
Now, this language is used by other insurers, such as Erie. However, Allstate falls back once again on that tricky little phrase mentioned above. Unlike Erie, Allstate doesn’t have language to explain that if the loss is sudden and accidental, it is still covered.
For example, imagine that you have a small leak from your roof trickling into your wall.* You don’t see the leak, there are no signs of a leak, and there is no way on Earth you could know that a leak even existed (without x-ray vision, that is!)
One day, a big storm rolls in. This causes the leak to grow bad enough that the water penetrates the wall and enters your home, where you can finally see it. Even though this is a “sudden and accidental” event which should be covered, Allstate will try to deny you claim saying that the leak was continuous and repeated.
*Note: State Farm’s policy is even more ambiguous when it comes to leaks. The State Farm policy says leaks which occur “over a period of time” are not covered. What does that mean? A second, minutes, hours, days, weeks, months, years, decades are all periods of time, so which one is it? But we’ll get to State Farm in a later blog post.
3. Claims Handling
For this one, I want to step away from the policy and talk about how Allstate (and some other carriers) treat their customers.
First and foremost, you need to remember that insurance companies make money by NOT paying your claim. They will do whatever they can to avoid paying you. This is the unfortunate nature of insurance companies as a whole, and to be honest we cannot blame them: how does any business continue to exist without bringing in a profit?
The problem here is Allstate takes this practice to more extremes than any other carrier I have seen. Allstate will bring in and pay experts, they will pay lawyers, and they will create a large file all in the name of not paying your claim. This doesn’t always fit the logic of a claim.
I have actually witnessed Allstate deny my clients’ claim for $12,000 and ask their lawyers to take the case to court. The lawyers lost, then carried the loss through to appeal, and a second appeal, where there was a settlement. So now, not only does Allstate still have to pay the settlement, they are stuck paying the legal and attorney fees that went along with fighting it.
At the end of the day, Allstate would rather pay their lawyers than pay you.
There is a reason why they do this. They do not expect a person whose claim is denied to pursue legal representation of their own. This is why it is imperative that you contact Wheeler, DiUlio, & Barnabei the instant that your claim with Allstate is denied or underpaid. Our job is to defend you.
Even if you have been fortunate enough to have not filed a claim yet, if you have an insurance policy with Allstate and would simply like to discuss your, please feel free to give us a call. We will review your policy absolutely free, and advise you on the best ways to protect yourself should the need to file a claim arise.
When it comes to protecting your home and your family, there are no better hands to be in than those of Wheeler, DiUlio, & Barnabei.