The Not-So-Happy Real World of Auto Insurance

Oddly enough, the “Consumer Guide to Auto Insurance” does NOT contain any real information on auto insurance companies. For that, the consumer must dig deeply into the Insurance Division’s website, where information about complaints about insurers is presented in aggregate form, so that it is impossible to tell anything about the individual complaints. The format also prevents the consumer from recognizing that the practice that they are suffering from is a violation. A good many consumers take abuse from businesses simply due to ignorance about a particular practice being illegal — the consumer thinks the business would not engage in a practice that is illegal, and since the consumer is experiencing a particular kind of treatment, the consumer concludes that it must be OK.

The Insurance Division needs to take a cue from the the Oregon Attorney General’s Office of Consumer Protection, where complaints about businesses are summarized by type and the individual complaint records are available to the public, and the complaint history of each  particular company is available for searching.

Most important, notice that the Insurance Division does not report whether the consumers agree with the Insurance Division’s determination as to whether their complaint was confirmed or not.

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A complaint index of 1.00 is average. That means the company’s share of confirmed complaints is equal to its share of business in Oregon. A complaint index of 2.00 means the company’s share of confirmed complaints is twice as large as its share of business.

How to use this report

The Consumer Guide 2014 Report for Oregon Insurance Complaints is an annual report of consumer complaints against major insurers in six types (or lines) of insurance:

  • Auto
  • Health
  • Homeowner
  • Life
  • Annuities
  • Long-term care

The guide includes the following information for calendar year 2014 for the major insurance companies doing business in Oregon:

  • Oregon premium

■   Total consumer complaints closed by the Insurance Division

  • Confirmed complaints

A confirmed complaint is a complaint in which an insurance company provided some kind of relief to a consumer or took some other action after a complaint was confirmed with the Insurance Division. Examples include complaints in which an insurer took any of the following actions:

  • Made an additional payment or a refund to a consumer
  • Issued or restored an insurance policy
  • Extended insurance coverage
  • Reopened or settled a claim
  • Provided some other kind of relief (for example, responded to a consumer’s inquiries)

Complaints in which the consumer and insurer couldn’t agree on the facts of the case also are counted as confirmed complaints. In addition, the guide includes a “complaint index” and a ranking for each insurance company.
 
How to use the complaint indexes and rankings

Consumers can use the complaint indexes and rankings to compare the complaint records of insurance companies.
 
Total complaints are reported in the guide because each complaint indicates a consumer had a problem with an insurer. However, only confirmed complaints are used in computing complaint indexes.
 
Examples of complaints not used in complaint indexes include the following:

  • Those in which the Insurance Division found that an insurer had complied with Oregon insurance laws and rules
  • Those in which the Insurance Division did not have jurisdiction (legal authority) to make a determination

A complaint index of 1.00 is average. That means the company’s share of confirmed complaints is equal to its share of business in Oregon. A complaint index of 2.00 means the company’s share of confirmed complaints is twice as large as its share of business.
 
Example: XYZ Insurance Company had 10 percent of the market for auto insurance in Oregon. It also had 10 percent of the confirmed auto insurance complaints. XYZ’s complaint index would be 1.00.
 
After complaint indexes are computed, insurers are ranked by their complaint records. A ranking of 1 indicates the best complaint record — or the fewest confirmed complaints in relation to the amount of premium the company wrote in Oregon in 2014. The highest numerical ranking indicates the worst complaint record — or the most confirmed complaints compared to the amount of premium written.