Evil insurance company? Following the law? Both?

John Cord//August 20, 2012//

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While on a blissful vacation at Rehoboth Beach last week, I was alerted by Wil Wheaton (why are you saying it like that?) through his Facebook page that there was some bad behavior by insurance company Progressive. I have handled my fair share of Progressive automobile collision cases, so I clicked the link. I didn’t expect the vitriol on the Internet, which was spreading a social media-kindled firestorm about one lawsuit.

This all stems from an unspeakably horrible automobile accident in Baltimore that took the life of one young woman, Kaitlynn Fisher. The other driver’s insurance company (Nationwide) offered up its full policy limits (a mere $25,000). Fisher’s family, wanting to pay back her student loans, according to Fisher’s brother, sought to recover under Fisher’s underinsured coverage with Progressive. Progressive apparently made some attempts to settle the matter, “never higher than 1/3 of the amount they owe,” according to Fisher’s brother. Those offers were not accepted.

There was also some dispute about whether the other driver was negligent or whether Fisher was negligent. In Maryland, sole or contributory negligence of the plaintiff, even 0.001 percent, means a complete loss of the case. The case went to trial, the other driver was found negligent, Fisher was not found contributorily negligent and the jury rendered a verdict of $760,000. (Sidenote: The Progressive policy was $100,000.)

This is all consistent with how underinsured motorist cases are litigated and resolved here in Maryland. If I am injured in a collision, and the negligent driver has a policy that is too low to “make me whole,” I can collect the full value of that policy. Then, I can proceed against my insurance company to collect the value of my underinsured motorist coverage, minus the value of the smaller policy.

Don’t get me wrong — I’m not part of Progressive’s fan club. I bet nine out of ten auto accident attorneys in Maryland would say the same thing — the company doesn’t take responsibility when they should and its pre-lawsuit offers are terrible (many lawyers won’t even negotiate with them until after filing a lawsuit).

What we’re missing, before we really excoriate Progressive, is the rest of the story. What did the other driver say about the accident? Were there any credible witnesses who said that Fisher was at fault? I haven’t found that information anywhere online. (If anyone gets trial transcripts, please let me know.)

The reason for the Internet hating on Progressive is that it just feels wrong. The victim had insurance. Her own insurance company basically fought her family over paying up the policy. To most of us, this feels like paying for something and not getting the benefit of it. Our insurance companies are supposed to be there for us.

Instead, the insurance company is doing what insurance companies do: protect the bottom line. What Progressive did is absolutely legal, is absolutely to be expected and probably most other insurance companies would have done the same thing. For whatever reason, Progressive thought that a jury might question who was at fault for the accident and it hoped to get a defense verdict and escape with only the legal costs of defending the case. Under Maryland law, the underinsured insurance company must pay only if the other insured was negligent and its insured was not negligent. That’s how underinsured motorist coverage works. Maybe there’s a better way, but that’s for the legislature to figure out.

To Progressive’s credit, it doesn’t appear to be moderating some of the hate mail its getting on its own website blog posts. This certainly encourages some good discussion.

I’m interested to know what others think about this. Does it change your opinion of Progressive? If you have Progressive insurance, will you cancel your policy and sign up with another company?

If you’re interested in more background on the case, here are some links: