• Bob Siems

Data and the MIA: Complaint numbers and what they tell us

This graph illustrates a statistic from the Maryland Insurance Administration's report. The MIA reported the amounts of different complaints it receives. (This data comes from the FY 2016 Annual Report, page 4.)

FY 2016 Complaints to MIA

This data table shows complaints by unit. The MIA presented it as three numbers (Life and Health, Appeals and Grievances, and Property and Casualty.) It provided the State Farm number as a note. I broke the State Farm number out.

Apparently 56% of all complaints (or ~72% of all Property and Casualty complaints) involve one thing: policyholders disputing State Farm issuing a notice of premium increase.

This quantifies that State Farm is trying to jack people's rates up more a lot. Probably because they're losing money.

It doesn't show that State Farm is particularly bad for an insurer. That would require seeing at least their market share, their win-rate in these matters, and a look at their relative risk pool. Maybe State Farm's conduct is normal, adjusted for their market share and a particularly litigious risk pool? That's unlikely. GEICO has larger market share if I recall correctly. But it isn't impossible.)

This also shows the number of angry policyholders in Maryland. In my experience, many policyholders with serious disputes against their insurer wind up filing a complaint. Filing complaints is easy and doesn't cost money. About twelve people a day in Maryland (not counting the State Farm rating complaints) get mad enough at their insurer to file a complaint with the Maryland Insurance Administration.

Again, we don't really know whether that's good or bad. Maybe other states have more per capita complaints. Maybe they have less. Maybe they have the same.

So why care about data that doesn't really tell a full story? This data leapt out at me because it lets me give my clients context for their experience. Most policyholder-clients are on their first claim and don't know what "normal" is. These numbers put their experience in some sort of context. That might not solve their legal problem, but I find it helps many understand that they aren't alone.

#Data #MarylandInsuranceAdministration #Rating #InsuranceBadFaith

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