Insurers Deny Reality as Well as ClaimsEveryone who has been anywhere near a movie theater or video store in the past decade surely knows the story of the Titanic. On April 10, 1912, this massive ocean liner hit an iceberg in the North Atlantic and sunk to the bottom of the sea, bringing 1500 people with her.
Imagine the uproar if all the insurers that had policies out on that ship refused to pay the claims, and refused to do so on the grounds that since the ship had been pronounced “unsinkable,” they didn’t believe the ship had actually sunk?
This absurd scenario is actually being played out just under 100 years later, with auto insurers refusing to believe that a piece of dated anti-theft technology is failing.
A recent article in Wired Magazine shows that cars that are equipped with “transponder” style anti-theft devices are being stolen with abandon. Despite an enormity of evidence that these new devices can be easily circumvented, insurers are constantly refusing to honor claims of theft and just barely accusing the victims of being the thieves.
Put simply, a transponder is a device that emits a specific frequency. This device is placed in the key to your car. This specific frequency is initiated when you put your key in the ignition. The frequency is then recognized by the computer in your car, which then allows the car to start. If the computer in your car doesn’t recognize the frequency, or if it doesn’t hear any frequency at all, the car won’t start.
Despite this ingenious technology, car thieves are now doing what they have always done. They adapt, find ways around the new technology, and continue to steal the cars.
Car thieves might be immoral, lazy, shiftless sociopaths, but you can be sure that they aren’t stupid. Every ten years or so, new anti-theft technology or devices are put into place, and the car thieves go to work on figuring out how to get around them.
Car alarms seemed to be the penultimate anti-theft device, until car thieves realized that people weren’t calling the police upon hearing one. Instead, everyone just yelled “Shut up!” or “Turn that thing off!”
“The Club” and other such steering wheel locking devices had their day in the sun, and now experienced car thieves can get through them in seconds. There are even commercially marketed devices that are specifically used to break through “The Club” or similar products.
“Lojack” and other GPS devices were fine, until thieves figured out how to simply pull the fuse in the electrical system that led to the device, which rendered it useless.
Transponder technology has been in use in automobiles for just over twelve years. For car thieves, twelve years is an eternity. The idea that sufficiently motivated criminals wouldn’t immediately get to work on how to get past the latest obstacle is an absurdity. Computer hackers don’t simply throw up their hands and give up as soon as new firewall or security technology is introduced. They start working, and inevitably, they surpass the changes. Car thieves are no different.
In the Wired article, Brad Stone does an admirable job of describing the flaws of the transponder technology, and how car thieves and even repo men are getting past it. He also interviews several victims of car theft, who all had their claims denied by the insurance company. The insurance companies were working under the assumption that since the transponder technology is, to their mind, “impregnable,” these victims must have been engaging in insurance fraud.
Far be it from us to say that insurance fraud isn’t real. We are well aware of the criminal element out there, and we deplore such behavior just as much as the insurance companies do. But surely, if anyone is up to date on the latest in auto theft techniques besides car thieves, it HAS to be GEICO, State Farm, Progressive, and all the other multi-billion dollar car insurance conglomerates. It is impossible for us to believe that these companies have such a steadfast belief in the effectiveness of transponder technology that they refuse to even consider the alternative. Therefore, we have to believe that their steadfast belief is an act.
The motives here are utterly transparent. Rather than live up to their financial obligations, the insurers would rather look for any conceivable way to avoid paying out. If that means using a technology that doesn’t work anymore as a scapegoat, then that is how it’s going to be. As a result, there are hundreds of Americans paying anywhere from a few hundred to a few thousand dollars a month on cars that they don’t even have. If that seems like a harsh and mean spirited judgment on insurance companies, that’s because we are speaking from experience. We have represented injured Georgians in cases against insurers for decades. We know that the insurer’s first responsibility is to his bottom line, and as a result we have helped those dealing with insurance companies to fight off lowball settlements, stalling tactics, and outright bad faith practices.
While we don't practice this type of case, we thought it would be a good example as to how big insurance is taking advantage of their customers.
If you or a loved one has been injured in an accident through no fault of your own, and you feel that the insurance company involved isn't taking your needs seriously, contact our offices for a free legal consultation.