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FOR IMMEDIATE RELEASE NAIC TRACKS TOP CONSUMER COMPLAINTS Delays, Denials and Unsatisfactory Settlements Spark Consumer Displeasure Against Insurance Companies KANSAS CITY, Mo. (March 10, 2007) - Recent statistics show that while consumer complaints decreased for the third consecutive year, the reasons behind those complaints have remained relatively the same for the past five years.
According to data collected by the National Association of Insurance Commissioners (NAIC), the top three reasons consumers filed formal complaints against their insurance companies in 2006 were delays, denials of claims and unsatisfactory settlement offers. Rounding out the top five sources of consumer complaints were policy cancellations and premiums/insurance rating issues.
The NAIC maintains a centralized electronic Complaint Database System (CDS), through which states voluntarily report "closed" complaints. A closed complaint is a complaint that has been investigated and resolved to the satisfaction of the state or jurisdiction in which it is filed. First established in 1990, the CDS was significantly expanded in 1998 and now houses more than 2 million complaints. A total of 190,572 consumer complaints were reported to CDS in 2006, a 7.8 percent decrease from the previous year. This information is based on the submission of data to the NAIC from the state insurance departments. The NAIC does not collect all complaint data from all states.
Aggregate data compiled from the CDS can be accessed on the NAIC's Web site through the Consumer Information Source link. By accessing this program, consumers can obtain company-specific complaint ratios (the ratio of the company's market share of complaints compared to the company's market share of premiums for a specific policy type), as well as aggregate counts of complaints by state and by type of coverage for specific companies.
Below is a chart detailing the top five types of complaints and the top five complained about insurance coverages for 2006. The chart includes the total number of complaints (for complaint type and line of coverage), followed by the percentage of overall complaints each type represents. (Example: "Delays" make up 21.9 percent of all complaints received by the NAIC in 2006.)
About the NAIC Headquartered in Kansas City, Missouri, the National Association of Insurance Commissioners (NAIC) is a voluntary organization of the chief insurance regulatory officials of the 50 states, the District of Columbia and the five U.S. territories. The NAIC's overriding objective is to assist state insurance regulators in protecting consumers and helping maintain the financial stability of the insurance industry by offering financial, actuarial, legal, computer, research, market conduct and economic expertise. Formed in 1871, the NAIC is the oldest association of state officials. For more than 135 years, state-based insurance supervision has served the needs of consumers, industry and the business of insurance at-large by ensuring hands-on, frontline protection for consumers, while providing insurers the uniform platforms and coordinated systems they need to compete effectively in an ever-changing marketplace. For more information, visit NAIC on the Web at: http://www.naic.org/press_home.htm.
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©2007 National Association of Insurance Commissioners. All rights reserved. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
