Progressive Meme Gets Halfway Around the World Before The Truth Gets its Pants On

There's a wee bit more to the "Progressive defended my sister's killer" story that went viral yesterday.

Yesterday, a Tumblr claiming that Progressive Insurance defended a woman’s killer in court rather than pay her family the benefits it was owed went viral. Not only was it all over Twitter, where the meme started, but it was picked up from outlets ranging from the Daily Mail the Daily News, the Huffington Post to The Blaze, and from Boing Boing to this here blog.

Meanwhile, Progressive issued a bland corporate statement that didn’t deny the allegations. Said denial was included in several of the above reports, including mine, but it hardly undercut the wrenching story of a brother who’d lost his sister and then he to fight her insurance company in court. Now, the facts are slowly trickling in.

First, Progressive has now denied the most insidious charge:

To be very clear, Progressive did not serve as the attorney for the defendant in this case. He was defended by his insurance company, Nationwide.

There was a question as to who was at fault, and a jury decided in the Fisher family’s favor just last week. We respect the verdict and now can continue to work with the Fisher family to reach a resolution.

That’s only technically true. While the defendant was indeed represented by his own insurance company, Progressive applied for an was “GRANTED all rights to participate in this proceeding as if it were an original party to this case.” And, boy, did they.  Matt Fisher, the New York comedian and brother of the Progressive customer who was killed in the accident in question, posted this in response:

At the beginning of the trial on Monday, August 6th, an attorney identified himself as Jeffrey R. Moffat and stated that he worked for Progressive Advanced Insurance Company. He then sat next to the defendant. During the trial, both in and out of the courtroom, he conferred with the defendant. He gave an opening statement to the jury, in which he proposed the idea that the defendant should not be found negligent in the case. He cross-examined the plaintiff’s witnesses. On direct examination, he questioned all of the defense’s witnesses. He made objections on behalf of the defendant, and he was a party to the argument of all of the objections heard in the case. After all of the witnesses had been called, he stood before the jury and gave a closing argument, in which he argued that my sister was responsible for the accident that killed her, and that the jury should not decide that the defendant was negligent.

I am comfortable characterizing this as a legal defense.

So would most of us, I think.

Still, it turns out, as soulless as their initial response to the public controversy and unseemly as their fighting a dead customer’s family in court might have been, Progressive isn’t really the bad guy here. They really didn’t have much choice under our system.

As our own Doug Mataconis, who unlike myself went to law school and is a licensed member of the bar, notes,

This is what typically happens in cases involving underinsured or uninsured motorists when the policy holder, or their representatives in this case, are unable to settle with the insurance company. Without knowing the facts of the case, I can’t say that there’s anything at all unusual about it.

Fisher is incorrect about one thing. The underinsured motorist coverage does not mean that Progressive is liable for the difference between whatever the other guys insurance company paid and “the value” of his sister’s policy. It means they are liable for the difference between what the other insurance company paid and the actual damages suffered in the accident.

And how do we determine said damages? Alas, we either come to an agreement amicably or we fight it out in court in an adversarial system.

Ted Frank, a felllow with the Center for Legal Policy, adds more important information:

Maryland is one of the few remaining contributory negligence states: if Katie was 1% at fault in the accident, there is no liability to the other driver or Progressive. As the author himself admits, there was a “possibility that Katie was at fault in the accident.” Is Progressive supposed to give money away when they aren’t legally obligated to do so? The author says “One indication that the case was pretty open-and-shut was that the other guy’s insurance company looked at the situation and settled with my sister’s estate basically immediately.” But because “that payment didn’t amount to much,” that insurance company could have reasonably decided that there was little point in spending the small insurance limits on attorneys instead of just writing a check. Progressive had more money at stake and more reason to defend.

Yes, “[c]arrying Progressive insurance and getting into an accident does not entitle you to the value of your insurance policy.” But that’s true for all insurance companies when the policy holder is not in a no-fault state. Progressive isn’t unique in that regard.

As of 2007, Maryland permits recovery on a “bad faith” theory against insurers who refuse to pay claims where liability is not “fairly debatable.” One would expect that Progressive would not have taken the action it did, and risk liability, if their position was not “fairly debatable.”

I don’t know what the limits of Katie Fisher’s policy were. But the result of the case was that the driver was held liable for $760,000 in damages plus the costs of litigation. Presumably, Progressive is on the hook for that amount minus whatever amount the driver’s Nationwide policy covered.

We still don’t know all the facts here. Most notably, did Progressive simply refuse to pay anything? Did they offer the Fisher family a settlement that they felt was inadequate, leaving court as the only option?

Regardless, given that Progressive was only responsible for the damages if their client did not in any way contribute to the accident and that the amount of damages was in dispute, taking the case to trial was a perfectly reasonable course of action. And, while distasteful, there were only two legal parties in this case—the Fisher family and the other driver—and Progressive was naturally on the other side here. Conversely, had the other driver had a more generous policy, Progressive might well have sided with the Fishers in trying to maximize their payout from Nationwide.

FILED UNDER: General
James Joyner
About James Joyner
James Joyner is a Security Studies professor at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. SKI says:

    IIRC, per M. Fisher, they offered about a third of what they ultimately were responsible for.

  2. James Joyner says:

    @SKI: $250,000 actually strikes me as a pretty generous offer in a situation where, if the claimant were deemed even 1% liable, they’d owe nothing.

  3. DRS says:

    I think we can partly attribute this to the fact that Progressive is an auto insurer, and there are very few people who haven’t been inconvenienced (at least) by their auto insurer or who know someone else who has. Dissatisfied customers can go from zero to 250 in three seconds if you ask them about their experiences. So the meme that “auto insurer does something dickish” isn’t so hard to believe.

    It also helped that the victim’s brother is a guy whose profession requires him to be articulate and concise, and think on his feet. That means that he’s able to get his point across much more effectively than an anonymous badly-trained, going-by-the-manual corporate spokesperson.

    Andrew Sullivan had an interesting post yesterday about another internet rumor and why it took off: http://andrewsullivan.thedailybeast.com/2012/08/the-anatomy-of-an-internet-rumor.html

  4. PD Shaw says:

    I don’t know much about underinsured disputes, but a couple of things stand out:

    I think in my state underinsuance coverage is usually only for the difference between the negligent driver’s insurance coverage and the state minimum. In other words, if Maryland required drivers to have insurance with a $500,000 limit, but you get hit by an out-of-state driver with a $250,000 limit, the underinsurance coverage would be for that $250,000. Maybe that’s negotiable for a higher premium.

    The other item is that Nationwide was defending its insured in this lawsuit, even after paying or offering to pay its policy limits. That suggests there is another pocket in play here, that of the underinsured driver. I’m guessing that Progressive wants the underinsured driver to reimburse it for any pay-out on this case. That may explain the lawsuit, the problems with settlement, and the brother’s odd sympathy to the driver that killed his sister.

  5. Rob in CT says:

    This might have been a situation where Progressive would’ve been better off making a little “business decision” (as we say in the biz) to not be ultra-aggressive in attempting to maximize other insurance contribution/Progressive’s payout. I have to think the black eye from the story will be costlier.

    But it’s hard to know that going in.

  6. MarkedMan says:

    James, I think you are making a distinction without a difference. The company chose to side with the defendant. The fact that they did so out of a profit motive and not because they were purely evil won’t mitigate much in most peoples eyes.

  7. It’s not the purpose of an insurance company to lay back and pay every claim. They have an obligation to their other policyholders and to their shareholders to only pay what is due and owning. As the post that James linked to explains, there was a serious question here about whether or not the Defendant was legally liable for any damages at all. Yes, this woman’s death is a tragedy, but tragedy does not mean that one is automatically entitled to money.

  8. James Joyner says:

    @MarkedMan: That the victim is sympathetic and the law is icky makes Progressive look bad. But it can’t simply pay out every claim on the off chance that someone connected to the claim is a minor celebrity who can take the case viral.

  9. wr says:

    @Doug Mataconis: No, but she had a case to make and she made it in a way that went a long way to evening out an insanely uneven playing field.

    As you like to say, corporations are required to do everything within the letter of the law to provide maximum profit for their shareholders. (Not that this has always been the case, but in our current culture we have come to believe that the only good company is a sociopathic company.)

    If that’s the way the game is played — that there is no greater societal responsibility for a corporation than that — then why should that company’s customers not also use every legal avenue to extract their maximum benefit from the corporation?

    This policyholder worked within the company’s systems for months to get what she felt she was owed. And when Progressive refused, she used the consumer’s only weapon — she went public and brought huge public pressure on them.

    I understand that you see it’s the corporations duty — and therefore admirable — to maximize their profit, even at the expense of their customers.

    What I don’t understand is why you seem to think that their customers should then also work to maximize corporate profit at their own expense.

    If companies are waging war on consumers, then the consumers can even fight back — through boycotts, through public shaming like this — or they can be victims. Why do you believe that we should be victims?

  10. sam says:

    @Doug Mataconis:

    As the post that James linked to explains, there was a serious question here about whether or not the Defendant was legally liable for any damages at all. Yes, this woman’s death is a tragedy, but tragedy does not mean that one is automatically entitled to money.

    As Maryland is a strict contributory negligence jurisdiction (and not a comparative negligence one), it’s perfectly possible that the jury said, “To hell with the contributory negligence standard…” It’s happened before (and is part of what has led other jurisdictions to adopt the comparative negligence standard, under which an award is reduced by a percentage equal to the percentage of negligence attributable to the plaintiff — roughly).

  11. James Joyner says:

    @wr: The policyholder was killed in an automobile accident. Her family was trying to get Progressive to pay what amounts to a life insurance benefit.

  12. MarkedMan says:

    I agree that sometimes companies have to do crummy-looking things to legitimately protect their interests. Trivial example: Disney forcing a non-profit daycare center to paint over their Mickey mouse – Bad optics, but essential under our system. The Progressive case is different to me. They didnt simply let the justice system play out and accept the verdict. They came in on one side and sought to influence the courts verdict simply because it would benefit them financially.

  13. @wr:

    The only thing I object to is the way that the original Tumblr poster, and the rest of the Internet, clearly misrepresented the facts in this case.

  14. @wr:

    Also, “waging war on consumers”? Give me a break.

    Progressive, or any other insurance company, is only legally obligated to pay claims that are due and owing.

  15. PD Shaw says:

    I think the 1% contributory negligence rule is pretty draconian, but that’s apparently how Marylanders like it. Here, I believe the rule is that a finding of 1% contributory negligence would reduce the verdict by 1%, and only at 50% fault would a nonsuit occur. Since we’re taught to dry defensively, its not too hard to imagine that a jury might find that the plaintiff drove too fast for conditions, for example, even if they were within the speed limits, or failed to observe oncoming traffic that was going to run the red light. I’m guessing these types of arguments aren’t very successful however when your pointing the figure at the empty chair of a dead woman.

  16. @MarkedMan:

    No, they intervened as a party with an interest in the case (which under Maryland law they are because they are the UIM carrier). If they had not intervened in the case, they would have potentially subjected the company to a default judgment and whatever Adjuster made that decision could’ve have possibly lost their job for such a stupid decision.

  17. MarkedMan says:

    @wr: Hear, hear. There is a certain type of conservative that can justify virtually any action by any company (I’m not including Doug here, despite my many disagreements with him) but becomes red faced and spittle flecked at the very thought of people defying those corporations by, say, forming a unio, in an attempt to balance power.

  18. PD Shaw says:

    @James Joyner: “Her family was trying to get Progressive to pay what amounts to a life insurance benefit.”

    Yes. We’re talking about a liability policy, the insurance company promised to pay the legal damages that were found to have been negligently caused by the driver. That’s usually not a set number, its an argument.

    A life insurance policy pays a set amount on the event of a condition (unintentional death).

    It sounds like a lot of people are threatening to leave Progressive misunderstanding what the auto insurance covers and they are going to get the same coverage from someone else. And maybe they should be thinking about life insurance.

  19. wr says:

    @James Joyner: That’s your opinion, and Progressive’s. Progressive has thousands of lawyers and millions of marketing dollars to put forward their side of the story — and that’s all the way it’s supposed to be, apparently. But when any consumer takes their fight with a corporation public — the only way an individual has a chance against a huge corporation — it’s all pearl-clutching all the time around here, as if those poor companies are nothing but innocent victims of those cruel, all-powerful individuals.

  20. wr says:

    @Doug Mataconis: Did they misrepresent the case? Hmm, I wonder if the big insurance companies “misrepresented” any cases to the Maryland legislature to get laws pass to say that if their client is 1% responsible for an accident, they don’t have to pay a nickel of the claim?

    Again, you seem to be honestly shocked and hurt that any individual is willing to use assymetical tactics against a corporation, when we all know that the should simply use their mult-million dollar legal and marketing departments, just like the companies do.

  21. wr says:

    @Doug Mataconis: “Progressive, or any other insurance company, is only legally obligated to pay claims that are due and owing. ”

    And the customer believes that this claim is due and owing.

    Do you believe that whenever we are denied by an insurance company we should simply accept their decision as a fair and honest judgment based solely on facts? Or is it conceivable that insurance companies attempt to minimize their payouts to the greatest extent possible, and therefore when there’s a dispute, the customer may have to fight for what he believes are his rights?

  22. @wr:

    And the customer believes that this claim is due and owing.

    As James said, there was a dispute as to what the damages were, which is why the case ended up in Court. This happens a lot in personal injury and wrongful death cases.

    Do you believe that whenever we are denied by an insurance company we should simply accept their decision as a fair and honest judgment based solely on facts? Or is it conceivable that insurance companies attempt to minimize their payouts to the greatest extent possible, and therefore when there’s a dispute, the customer may have to fight for what he believes are his rights?

    Again, this is why we have a civil court systems, to resolve these disputes. Just as this woman’s family had a right to pursue the claim in Court, Progressive had a right to defend itself. That’s how the system works.

  23. Rob in CT says:

    misunderstanding what the auto insurance covers

    I’m shocked. SHOCKED! To find out people don’t know what their insurance actually covers (and doesn’t cover).

    Yeah, I’m an insurance coverage geek. And you know what? I don’t always know, at least off the top of my head.

    Insurance policy langage has been litigated to hell and gone and the result is that they’re complicated and difficult for a layperson to figure out. Not impossible by any means, but hard. And it’s not really anybody’s fault in particular. Simplicity != clarity. And clarity is far more important. Plus there are risks that pop up that are new and you have to deal with (e.g. an explosion in mold damage claims a few years back). So you get lengthy, complicated policy language. Comparing a liability policy from the 60s to a current model is darkly amusing.

    Generally speaking, it’s hard for an insurer to maintain the balance between their duty to their policyholders and their duty to their shareholders (pay only meritorious claims and, within that category, pay the proper amount and no more). Not that I’m suggesting anyone break out violins! Certainly not. But it’s usually best to not assume the worst.

    Still, every so often I see a case blow up and I really wonder what the folks at the insurer in question were thinking.

  24. Rob in CT says:

    Oh, and to tie this back into the actual matter at hand (instead of just going off on my own little tangent): the 1% contributory negligence rule seems like the key here. Sounds like a bad rule, IMO. Maybe Maryland should change it.

  25. wr says:

    @Doug Mataconis: Yes, Progressive defended itself, and so did the claimant. So what’s the problem here? Why is what the client did wrong and what Progressive did right?

    Progressive had the right to deny this claim and fight it in court. But they did not have the right to do it without costs. In this case, the cost is millions of dollars in damaging publicity they could have avoided simply by not exercising their legal rights and actually treated a customer well.

    You seem to think that no only should a corporation do everything they can to maximize their profits, everybody else should simply go along with that.

    What I’m saying is that there are costs on both sides. And if corporations are going to exercise their full legal rights to screw over their customers, then they are going to pay costs in the court of public opinion.

    And maybe next time a situation comes up where they can legally screw over their policyholders, they’ll realize it’s not worth that cost.

    It’s like health insurance companies that write clauses in policies that allow them to retroactively cancel coverage if they can find a tiny error in the application — an error they will only search for if the customer gets sick and makes an expensive claim. They’ve got the right to do this — it’s right there in their contracts. But if enough people make a big stink about this immoral behavior — immoral in human terms, not corporate ones — then there’s a greater cost to them in reputation to continuing this behavior than there are savings from the cancellations.

    Again, you seem to think that corporations should be allowed to do everything legal to maximize their profits but should never be forced to pay the costs for this behavior. I don’t understand that thinking at all.

  26. grumpy realist says:

    @wr: Actually, the contributory negligence standard is standard historical common law, so you can blame the Brits for this one.

  27. @wr:

    Other than the fact that the original Tumblr post gets several key facts of the case, not to mention basic principles of insurance law, wrong I have no problem with the decedent’s family pursuing their claims. My problem is with the people trying to demonize Progressive for doing something that is common, entirely properly, and a regular part of how insurance cases work when UIM coverage is involved.

  28. wr says:

    @grumpy realist: But the idea that if the claimant is one percent responsible, then he is entitled to nothing is hardly standard. At least, not in states that aren’t completely owned by corporate interests.

  29. wr says:

    @Doug Mataconis: I certainly believe it’s common and definitely believe it’s part of insurance law. “Proper” is another issue altogether. If we live in a world where corporate interests are always right and consumer interests are always wrong, then sure it’s proper.

    But if you ask the people who are reading about this case and learning about what insurance companies think is “proper,” you’re suddenly discovering that there’s another way of looking at this.

    Again, I don’t understand why this bothers you so much. It’s the free market in all its glory. Progressive has the right to act like scumbags; consumers have the right to express their displeasure with the scumbaggery and take their business elsewhere.

    But as in every case when a consumer has tried to fight back against a corporation, you are whole heartedly on the side of the corporation and find the notion of a citizen daring to speak up somehow offensive.

    I get that there’s a kind of thinking that “corporations are people, my friend.” What I still don’t understand is why corporate people are always superior to the breathing ones in your mind.

  30. @wr:

    I reject your contention that there is anything “improper” here, or why there is any scumbaggery here. Insurance companies don’t exist simply to write people checks whenever they request them, no matter what you may think.

    Also, these people got a three-quarter million dollar verdict out of this case. What the heck are they complaining about?

  31. wr says:

    @Doug Mataconis: “Also, these people got a three-quarter million dollar verdict out of this case. What the heck are they complaining about?”

    I’m reminded of a famous film industry quote. Walter Hill and David Giler owned a chunk of the movie Alien, which the studio insisted for many years had never turned a profit, despite grossing multiple times all its costs. Hill and Giler sued, and the studio settled for several tens of millions of dollars.

    Shockingly, though, Hill and Giler continued to maintain that the studio had acted unethically. And this really disturbed the head of biz affairs, who said “I don’t see why these two keep complaining. We paid them the day after they filed their lawsuit.”

    I guess what you’re saying is that since the brother here finally won in court, he should simply be grateful that Progressive was willing to pay up after it lost. Forget about all the pre-court fighting not to pay what turned out to be a legally owed amount. Shut up and move on, and glory in Progressive’s generosity.

    Sorry, if a company has to lose in court before delivering on promises made, then they deserve public shaming.

  32. @wr:

    Progressive’s promise was to pay all claims due and owing. The parties had a dispute about what that amount was, and whether or not liability on the part of the decedent existed. These are legitimate legal issues which Progressive had the right, if not the duty, to pursue in Court.

    You either simply don’t understand how insurance contracts work, or you just don’t care.

  33. PD Shaw says:

    @Rob in CT: The advantage of standardization in the policies is that customers should be able to compare coverages based upon price, coverage limits and customer service without having to read the damn policies. And if people think Progressive Insurance provides bad customer service, by all means, go somewhere else. (Though this requires some divination, the customer being dead in this instance)

    But the comments at Progressive indicate a lot of people think these policies are apples, and Progressive is providing a lemon, and they are going to go buy a lemon from some other insurance company.

  34. wr says:

    @Doug Mataconis: Are you saying that an insurance company should litigate every claim against it, just to make sure they’re all due and owing?

    They’ve certainly got that right. And in the extremely short term, they’ll probably make a lot of money on the deal.

    And I guess if we live in a libertarian paradise, not one of their customers will ever go public with the fact that they are litigating every claim, as they have the legal right to do, instead of paying out before being ordered to do so by a judge.

    In the real world, there are consequences to actions, even for corporations. Progressive made a choice to litigate this claim, and to do so ended up apparently giving legal aid to the driver who killed their insured.

    Legally, it’s absolutely legitimate, as you keep saying. But then you also seem to think that the American people, who write checks to their insurance companies every month assuming that the company will be their ally, not their opponent, in the case of an accident, should simply applaud Progressive’s actions as good business.

    And again, maybe you’re right and all consumers are naive. But I keep seeing ads for insurance companies assuring me that they’re on my side, and in case I have a claim, they’ll be right there to help me.

    So if that turns out not to be the case, I’m going public with it big time. And if that hurts the company in the wallet, maybe next time they’ll live up to their implied promise instead of fighting for the letter of the contract.

    Why you find this troubling is still something you haven’t been able to articulate.

  35. Christy says:

    @Doug Mataconis:
    I don’t know that anyone is denying that Progressive had the right to act as defendant in the case. Clearly they were legally entitled to do so. People are upset because it’s a crummy thing to do, regardless of the legality or commonness of such practices.

  36. bk says:

    @Doug Mataconis:

    Also, these people got a three-quarter million dollar verdict out of this case. What the heck are they complaining about?

    You win the internets for the most tasteless comment of the day award. And it’s still early.

  37. @wr:

    If there is a good faith basis to litigate the claim and the parties are unable to reach a settlement, then yes they ought to do so. That is exactly what the legal system is for. In this case, as explained in the article that James linked to, there was a good faith basis to doubt legal liability in the case as well as the extent of monetary damages. The fact that you don’t like it is, quite frankly, irrelevant.

  38. Console says:

    Pointing out the incentives of why Progressive did what it did doesn’t change the nature of things. This is a decision that Progressive is going to make all the time because most of us don’t have the leverage of famous relatives/social media. But that doesn’t change it from being a stupid business decision in that 1 time. And the reason it’s a stupid business decision is because the average person sees it as morally reprehensible to seek profit at all costs.
    Yes, progressive is only legally required to pay out so much… but if the alternative is getting roasted on the internet for defending a drunk driver that killed your own client, MAYBE you should think outside of the box of legal requirements. Otherwise, no one is going to have a job a Progressive.

  39. Console says:

    @Doug Mataconis:

    It ain’t irrelevant if he’s a Progressive customer…

  40. Console,

    Again, if he chooses to willfully misunderstand insurance contracts that’s his choice.

  41. Rob in CT says:

    PD,

    The advantage of standardization in the policies is that customers should be able to compare coverages based upon price, coverage limits and customer service without having to read the damn policies

    I have no problem with standardization. I wasn’t posting about that. When I mentioned the complexity of insurance policies, I was talking about standard ISO language. Manuscript policies are rare. They’re drafted up for big, sophisticated clients. Everybody else buys their policies off the rack.

    But they still need to “read the damn policy” at least sometimes (and read notices about coverage changes). Standardized language is in a constant state of flux.

    It’s annoying and it can be difficult, but the alternative is simply making assumptions about what’s covered, what’s limited and what’s excluded. And that doesn’t end terribly well

  42. wr says:

    @Doug Mataconis: “The fact that you don’t like it is, quite frankly, irrelevant. ”

    That would be entirely true, if Progressive were a monopoly and there was nowhere else to get auto insurance.

    But guess what? There are lots and lots of other companies that sell insurance. So that if I — putting myself for the moment in the position of the injured party — don’t like it, I’m going to make it relevant by spreading my story as far and wide as I can. I’m going to let every other purchaser of auto insurance know exactly how Progressive operates.

    And if Progressive finds that thousands, or tens of thousands, or hundreds of thousands or even millions of customers and potential customers thinking they are sleazy crooks is irrelevant, well, they’ve certainly got the right and the platform to make that case to their shareholders.

    If there are any left at that point.

    I know that you find this a morally abhorrent concept — the idea that the little people should ever publicly question the wisdom of our corporate elites. But it’s not just corporations that have first amendment rights.

    It’s pretty clear that you are a lawyer and not a business owner. Because if you were the latter you’d know that the customer’s voice is not “irrelevant,” even if what you’re doing is within your legal rights.

  43. wr,

    Sorry but every other auto insurance company would have handled this situation in exactly the same way.

  44. Tom says:

    James Joyner says:
    Wednesday, August 15, 2012 at 10:14

    @MarkedMan: That the victim is sympathetic and the law is icky makes Progressive look bad. But it can’t simply pay out every claim on the off chance that someone connected to the claim is a minor celebrity who can take the case viral.

    Are you high? They certainly can. That was the contract Progressive entered into. Did Progressive ever turn down any of that extra premium you pay for a better policy?

    Just because the insurance industry tries to make extra profits by trying to force customers to take less than what they paid for doesn’t make it right.

    I saw a good comment about this:
    “No one’s business model can, or should, be denying their contractual obligations to you. That’s like saying McDonalds’ business model is taking your money and not giving you a cheeseburger until you prove in court that you actually purchased it.”

  45. wr says:

    @Doug Mataconis: “Sorry but every other auto insurance company would have handled this situation in exactly the same way. ”

    And you base that assertion on… absolutely nothing.

    Some companies prioritize customer satisfaction, believing that not fighting for every last nickel will eventually bring greater gains through repeat and increased business.

  46. Tom says:

    The title of this article is way off. You should change it.

    “We still don’t know all the facts here. Most notably, did Progressive simply refuse to pay anything? Did they offer the Fisher family a settlement that they felt was inadequate, leaving court as the only option?”

    Matt Fisher said Progressive made some offers up to a third of what they owed. It was in the original articles. How can you write an article that is so judging when you don’t even know the basics of the case?

    You should be ashamed.

  47. Tom,

    There is no such thing as “a third of what is owed.” What Fisher meant is that Progressive made offers that he and his family rejected. As I have said repeatedly in the comments here, all Progressive “owes” under the terms of the policy is to pay what is justly due and owing. Since the parties disagreed on that point, the matter went to court. Again, this happens all the time

  48. James Joyner says:

    @Tom:

    But it can’t simply pay out every claim on the off chance that someone connected to the claim is a minor celebrity who can take the case viral.

    Are you high? They certainly can. That was the contract Progressive entered into.

    Um, no. Progressive sold underinsured motorist coverage which covered owed damages over the limits of the other driver’s insurance. At dispute here were 1) whether the damages were owed and 2) what were the damages. This was not a case of, say, a life insurance company failing to pay out a lump sum death benefit.

  49. wr says:

    @James Joyner: Just wondering — are you and Doug even willing to consider the notion that, despite the legality, what Progressive did was bad business practice?

    Do you think that defending the driver who killed your client in order to avoid paying off a claim is just a normal part of doing business, and that it never should have occurred to them that the optics would be so awful they could conceivably end up losing far more in business than they could ever hope to gain from this case?

    Or is whatever a corporation chooses to do automatically right?

  50. Rob in CT says:

    @Doug Mataconis:

    I doubt that, actually. One has some discretion. Sometimes pushing things all the way isn’t the best idea, and sometimes smart people figure that out before the fit hits the shan.

    Just saying.

    Again, I’m short on details here and auto liability claims are not my thing so I’m not necessarily railing against Progressive. I’m just saying that you’re overreaching with the idea that this was the 1 and only correct thing to do.

  51. Console says:

    @James Joyner:

    Well, not only did they lose the legal decision, they also made a terrible PR mistake while losing.

    At what point does this cease being a “dispute” and turn into “Progressive made the worst possible decisions they could have in every phase?”

  52. wr says:

    @Console: Corporations can never be wrong. Corporations can only be wronged.

  53. PD Shaw says:

    I notice that damages available in Maryland include the pain & suffering of the deceased between the time of the accident and death. This is not a fixed amount, and its vigorously debated whether the victim in these types of traumas is conscious or not of what is happening.

    I wouldn’t be surprised that Progressive’s settlement offer was based upon the willingness to pay the medical and funeral expenses that Nationwide policy didn’t pick up, but not the non-economic losses.

  54. PD Shaw says:

    @Console:”not only did they lose the legal decision”

    I don’t think we know that. What was the family willing to settle for? Was it more or less than $760,000?

    How much of that $760,000 will be picked up by Nationwide?

    What are Progressive’s policy limits?

    Does Progressive have significant subrogation rights against the negligent driver?

    Its quite possible that the family demanded Progressive settle on the basis of Progressive’s worst-case scenario, in which case there was no compromise offered and it made sense to see what the jury decided. But we don’t know what the family’s demand was.

  55. Rob in CT says:

    I was going to mention that. We don’t know how the family/family reps handled the settlement negotiations. It’s possible they were crazy about it. I’ve seen some crazy settlement proposals in my time (involving claims that are a lot less emotional than death in a car accident). But we don’t know, and never will.

  56. jabusse says:

    @James Joyner: Offer of $250K when damages were found at trial to be 750K? At trial the jury was given instructions re contrib neg. and found the girl was not even 1% at fault. Right? Progressive admits that and they were represented at trial. Is Progressive going to harass the decedent’s family more and try and try it again? My guess is that the jury awarded the fisher’ss 750 K and that the person 100% responsible for the cause of the accident has minimal insurance. So if damages have already been determined and fault also determined Progressive needs to pay up at least to the policy limit if it is less than the award. The idea their representative lied and now wishes to “settle” the matter (means we pay less than what we should under out contract because we can delay and hassle the client to the grave if we want” made me cancel my progressive policy before I wrote this.

  57. jabusse says:

    @Rob in CT: 1Maybe there was settlement negotiations maybe not. The progressive rep said the liability and wward were determined at trial.

  58. EddieInCA says:

    James, Doug –

    You both should read this entire piece:

    YOU’RE BOTH WRONG as to Progressive’s position, AND actions.

    Here’s the key graf…

    Basically, this all goes to show just how much social media has changed the landscape in the ways corporations are allowed to treat regular people. With one quick keystroke from a former Star Trek cast member, Progressive has become embroiled in a massive scandal. And, sure, they just did what any insurance company would do (because, y’know, they all totally do stuff like this constantly), but it’s clear now that their attempts to keep this from becoming a big story have done the exact opposite. They lost the court case, they were going to have to pay anyway. They could have just said that from the very beginning. Instead, they misused social media platforms and then tried to hide facts through careful phrasing (Emphasis added).

    In other words, they’d already LOST THE CASE. Rather than paying, they chose to take on Fisher, and the end result will be millions and millions of lost revenue. I cancelled my policy with Progressive this morning, and went with Mercury. I’m just one, but I’m guessing others are doing the same thing. Will Mercury do something similar? Possibly. But I know for certain Progressive will, so I’ll take my business elsewhere.

    http://www.mediaite.com/online/progressive-insurances-response-to-the-fisher-scandal-is-a-textbook-example-of-a-pr-catastrophe/

  59. Peter says:

    What the Fisher family ought to do is file suit against Honda for selling unsafe deathtraps. One of the links has a picture of the two vehicles at the crash scene. The other driver’s vehicle (it appears to be an older Chevy S-10 Blazer, not a particularly large or robust vehicle) utterly owned Katie Fisher’s Insight. I’m not overdramatizng, the crash seemed to violate every law of physics.

  60. Bob Beller says:

    @Console: The problem is, after they pay this one, then they pay the next, and the next and the next, until they are spending millions in court with shareholders lawsuits or defending themselves at the SEC due to shareholder complaints.

  61. JD says:

    “Is Progressive supposed to give money away when they aren’t legally obligated to do so?”

    This is the part where I wanted to vomit a little. Since when did “I found a legal technicality” translate into “there is nothing even slightly dodgy about my actions”? Insurance is a safety net that we pay for, and looking for ways to screw people who paid for it does not strike me as something we should laud companies for doing. A society in which no one does anything beyond what they are legally required to do is not worth calling a civilization.

  62. wr says:

    @Bob Beller: “The problem is, after they pay this one, then they pay the next, and the next and the next, until they are spending millions in court with shareholders lawsuits or defending themselves at the SEC due to shareholder complaints”

    If an insurance company’s business model is such that they can’t pay the claims they promise — and charge premiums for — without doing themselves such hard they fall victim to shareholder suits, then that model is fatally flawed and that company does not deserve to be in business.

  63. Rob in CT says:

    @jabusse:

    Incomplete information, of course. I’d expect (but cannot say for sure) that there was at least an attempt at pre-litigation settlement. Or settlement pre-verdict. There just about always is, in my experience.

    It’s entirely possible that the family was reasonable and Progressive (for reasons that escape me) decided to play hardball. I just don’t know.

  64. Ron says:

    Raise your hand if you want a Progressive insurance policy!!!!!!!!!!!!!!

  65. Nick says:

    @Peter:

    Looks like the S10 photo was just stock photography, and that’s not an Insight. Looks like better pictures here in the video:

    article on cnn

    The offending SUV was a 2002+ Explorer which is pretty massive, and I don’t see that much intrusion in the passenger cell. Could just be bad luck, a bumper at the right height can do a tragic amount of damage to a head.