How Insurance Companies Delay Your Claim for Profit

As soon as the insurance industry finds out they have a potential claim, even if you haven’t made it yet, they take an amount of money and put it on reserve, which basically means they earmark it in an interest-bearing account, and they hold it there until the claim is resolved. And that requires them to make some snap judgments about how much the claim might be worth even if you don’t have the first clue how much it might be worth, or you haven’t gotten an attorney yet. So there are two things about that process that make the insurance company want to delay settling with you. The first is, I said it was an interest-bearing account, and sometimes the amount of money that’s going into that account is tens or even hundreds of thousands of dollars — millions of dollars. How much interest can the insurance company earn on money they’ve already decided they may have to pay to you, if they can make the claim take two years instead of two months.