Author: Richard H. Adler

In the early 1990's, Allstate Insurance Company adopted a confidential plan, known as "Claims Core Process Redesign" (CCPR). The goal was to enhance profits by having its personal injury claim representative and adjusters target personal injury claimants who did not have attorneys to encourage then to trust Allstate and not seek an attorney's advice. Under this plan, Allstate claims representatives offered to assist automobile accident victims in settling their personal injury claims against its at fault insureds. Allstate trained its claims adjusters to establish "empathetic, trust-based relationships" and "act as advocate" for unrepresented claimants so they would not hire attorneys.¹

After gaining the unrepresented injured claimant's trust, the adjuster recommended a personal injury settlement amount well below the actual value of the claim. Allstate's internal statistics show that by discouraging injured claimants from hiring plaintiff personal injury attorneys, and by cultivating trust between the injured person and the adjuster, they were able to persuade unrepresented people to settle for one-third to one-half of what the company would pay claimants with personal injuries who have legal representation.² These facts demonstrate how Allstate has been using its dominant position and training its adjusters to dupe unrepresented claimants into accepting disadvantageous settlement offers.

Allstate's "representation" of personal injury claimants is also a clear conflict of interest because the company undertakes to represent both its own at fault insured and the injured party bringing the claim against that insured. As Allstate must ultimately pay for the injuries and damages caused by their insured, it is clearly in Allstate's interest to reduce the amount of money the injured person gets paid, and against the injured person's interest to be maneuvered into accepting less than their claim is actually worth by Allstate.
Allstate's controversial policy has generated a wave of litigation. State Attorneys General, State Bar Associations and private individuals have filed at least 56 lawsuits (and counting) against Allstate in 22 states alleging that these practices are fraudulent, deceptive, confusing and illegal.

One such highlight case was brought in King County Superior Court and has made its way to the Washington Supreme Court, Jones v. Allstate Insurance Company, 146 Wn 2d 191 (2002). This case arose out of a claim for injuries filed by Janet Jones after she was seriously injured by an Allstate insured in an automobile collision. In that accident, Mrs. Jones's Chrysler minivan was broadsided by a 17 year old Allstate insured, causing it to roll. Mrs. Jones suffered severe head injury, as well as injury to her face. Her medical bills totaled nearly $100, 000.00.

The Allstate adjuster contacted the Jones family and intentionally misled them into believing that she represented their interests. She asked them to "trust me" and promised to treat them as if they were her own clients. Allstate advised Mrs. Jones to accept its offer of their at fault driver's mandatory minimum liability policy limits of $25,000.00. Allstate then advised them to sign an agreement releasing Allstate, the at-fault driver and the maker of Mrs. Jones's minivan from any further liability even though the settlement left them with nearly $70,000.00 in additional medical bills. Before the Release of Claims was signed, Chrysler had issued a recall for a defective safety belt in Mrs. Jones's model. The release, signed by Mrs. Jones, however, prohibited her from pursuing Chrysler for any further damages for injuries caused to her by the defective seat belt.

Allstate maintained it did nothing wrong. The King County Superior Court judge disagreed, ruling the release was invalid because the company was engaged in the unauthorized practice of law and did not fully disclose the conflict of interest their attempt to represent the injured person presented. Allstate did not like the trial judge's decision and decided to appeal the case. The case made its way to the Washington Supreme Court. On May 9, 2000, the Supreme Court ruled that:

Allstate's claim adjuster was engaged in the practice of law and, as such, shall be held to the standard of care of the practicing attorney. Here, Allstate's claims adjuster's conduct fell below that standard when she advised the Joneses to sign a release of liabilities, did not properly advise the Joneses that there were potential legal consequences of signing a settlement check and a release of all claims or refer them to independent counsel and did not fully disclose the conflict of interest she presented......We, therefore, affirm the trial court's grant of summary judgment and remand for consideration of the Joneses' Bad Faith Fraud claim, and Consumer Protection Act claim against Allstate, for consideration of the Joneses' remaining claims against Allstate and all other parties and for the awarding of damages.

Until Allstate ceases its "customer service" charade with personal injury victims, all providers-patients-attorneys-consumers-friends-family-colleagues have to be wary of this tactic. The injured are not Allstate "customers" and are not in "good hands." When you or your patients are injured in an automobile or other collision it is important to consult with a real plaintiff personal injury attorney before concluding your claim. Adler Giersch PS offers free and confidential consultations with its personal injury recovery attorneys, and has offices in Seattle, Bellevue, Everett and Kent to serve you.

1. Allstate Insurance Company, Claims Core Process Redesign Manual, 8, 10, Exhibit 6 (1995)
2. Allstate Insurance Company, Claims Core Progress Redesign Manual, 3, Exhibit 4.