‘Only pay for what you need’?
Thomas, a reader in Chicago, wrote:
“Liberty Mutual Insurance television commercials which state, ‘Only Pay for What You Need’ appear to suggest that other insurance companies will sell you coverages you don’t need. I’ll bet a lot of people wonder what they mean.”
This column has received similar comments and to find out what ‘Only pay for what you need” means, I contacted Media Relations at BostonBased Liberty Mutual, asking them that very question.
That was weeks ago and I am still waiting for a response.
Perhaps LM’s board of directors should look at their shocking one star Better Business Bureau reviews, and close to 1,000 complaints alleging some pretty shady business practices.
For some reason I can’t fathom, the Better Business Bureau gives them—and almost of all of huge insurance companies who advertise like mad—an A+ despite thousands of complaints from customers.
The BBB website tells us, “Customer reviews are not used in the calculation of BBB ratings.” Are you kidding? Not used?
BBB Chief Communications Officer Katherine R. Hutt confirmed that statement in a 30 minute phone call, explaining, “Many factors go into the letter grade assigned, but not customer reviews.”
This left me completely dumbfounded! Customer reviews matter everywhere else today, but apparently not to the Better Business Bureau.
The millions of dollars Liberty Mutual spends yearly on advertising, just like other huge insurance companies, “Is money they are not paying to deserving accident victims,” strongly maintains Los Angeles-based trial attorney Shant Karnikian, whose law practice concentrates on insurance company bad faith.
“When they say you will only pay for what you need, they are implying that other insurance companies will automatically sell you coverages that you do not need, which is complete nonsense.”
He’s right. I asked several Liberty Mutual agents what that advertising phrase meant and was told, “We allow you to customize your coverage. Most other companies just say, ‘Here is our policy, take it or leave it as is.’
The truth is that all insurance companies allow the customer to customize their policy.
He gives these recommendations:
(1) Auto Insurance: Never buy just the minimum amounts that are required by your state. Buy 50/100,000 liability limits or more, and always purchase medical payments coverage and uninsured/under-insured coverage in limits no less than $100,000.
(2) Homeowners/Commercial Property Insurance: Overestimate the cost of rebuilding your home or office and include coverage to bring the property current with building codes. In a major loss— such as a wildfire—material and labor costs will be far greater than at normal times. Inadequate coverage means you will have to pay out of pocket the difference in price.
(3) Ask In Writing: “What is the most coverage that I can possibly get for my home, car, liability and business?” The difference between the basic policy and a much larger one will not shock the conscience. It is definitely worth it.
(4) Consider a Broker instead of an Agent: A broker is not limited to selling policies from just one company and works for you. Agents are limited to selling only the policies of the company they work for which may not have the best policy for your needs.
Karnikian concluded our discussion with this advice:
“Imagine the cost of your worst case scenario and buy insurance in limits high enough to cover it.”