APCIA: Wall Street Journal’s Latest Headline Fails to Make Clear that Insurers Consistently Pay Auto Damage Claims

APCIA's President and CEO David A. Sampson sent the following letter to the editor to the Wall Street Journal responding to the article "If You Get in a Car Crash, the Risk Is Growing Your Insurance Won't Pay."

Dear Editor,

The Wall Street Journal is once again using a sensational headline that doesn't reflect the full facts presented in its own reporting, leaving readers with the false impression that auto insurers routinely deny valid claims.

The Journal's analysis found that auto insurers are paying physical damage claims at essentially the same rate today as they were a decade ago. There is no upward trend in claim denials for policyholders who are trying to repair or replace their cars.

The claims for which the Journal identified an upward trend are auto liability and medical claims that are closed without payment. Auto liability and medical claims are a magnet for billboard lawyers and fraudsters seeking to profit off the system, which is why these claims are investigated thoroughly. It is important that insurers do not pay meritless claims to control the cost of coverage for all drivers.

As with homeowners claims, auto insurance claims closed without payment do not mean insurers are wrongfully denying claims. There are a variety of reasons why an auto liability and medical claim may be closed without payment, including: the damage falls below the deductible, or an investigation of the accident reveals that those involved are not injured or do not wish to make a claim.

Equally important, the article fails to explain to readers that claims handling practices are heavily regulated by state laws and subject to intense oversight by state insurance departments.

Readers deserve headlines that accurately reflect the underlying facts, not cherry-picked information to make sensational points. In this case, the Journal's own analysis shows that insurers are continuing to pay auto damage claims at consistent rates, and yet the headline would lead readers to think otherwise.

David A. Sampson
President & CEO
American Property Casualty Insurance Association