You may be surprised to learn that insurance companies are not in the habit of advertising all the time. In fact, they may even stop advertising if they are losing money, much like how financial institutions may stop advertising if they have gone bankrupt. Moreover, insurance companies spend millions of dollars on lobbyists and politicians, which they can use to reduce premiums. So, why do they do that? What are the benefits?
Social media updates can cause problems with insurance claims
While social media can be a blessing or a curse for insurers, it’s important to remember that it can also pose a risk to those who file claims. Social media gives insurers a platform to highlight their successes and boast about their stellar customer service, but it can also raise the risk of an insurance claim going unpaid. We talked with two experts in this field, Steve Robson, the former head of claims for Brit Insurance, and Ed Quinn Jr., president and CEO of Rockville Risk Management Associates.
Using social media for insurance transactions can raise many risks and privacy concerns. Insurance companies don’t want negative comments posted on their pages, and the reputational risks associated with social media may be too high. Still, the insurance industry is likely to adopt social media, driven by cost pressures and a focus on younger consumers. In the meantime, there are many ways to protect your reputation and your finances while using social media for insurance transactions.
Insurance companies spend millions on lobbying
Health insurance companies have spent millions of dollars on lobbying in the past year. Aetna, Cigna, and Humana each spent nearly half a million dollars on lobbying. Their lobbying efforts focused on repealing the individual mandate, disapproving the Medicare Levy Ratio, exempting broker compensation from MLR, and creating a national insurance marketplace. AHIP spent more than $8.1 million in lobbying expenses during the first half of 2019 alone.
The insurers worry about health insurance reform and funnel millions of dollars to members of Congress to block the reform. One of the biggest beneficiaries of insurance industry lobbying is the Republican Party. Representatives from Minnesota’s Sixth district are among the biggest recipients of insurance industry contributions. Rep. Bachmann is a vocal opponent of the government health insurance option. However, even with all the insurance industry’s lobbying, Connecticut is far from the only state where insurers are spending millions of dollars on political campaigns.
They make it difficult to file a claim
If your insurance company makes it difficult to file a claim, you should consider strategizing ahead of time. For example, do not contact your insurance company right away after you’ve suffered an accident. The insurer you choose determines the time frame for filing a claim according to state laws. If you have questions, consult Thomson Reuter’s FindLaw, a legal resource. The insurance company’s time frame may be longer than you think.