The Chrysler Building is shown in this file photo in New York. A spokeswoman for Prudential Financial Inc. said Wednesday that the insurer has sold its 75 percent stake in the Art Deco skyscraper to the Abu Dhabi Investment Council.
Accused of “abandoning policyholders,” Liberty Mutual showed up on the American Association for Justice’s list of the top 10 worst in-surance companies in the country last week.
Ranked No. 10, Liberty Mutual was the only Massachusetts-based company to make the list, which included mostly large prop-erty/casualty insurers accused of unfairly denying or delaying claims. Liberty Mutual earned the AAJ’s condemnation for “a glut of litiga-tion” from vendors for cost-cutting, as well not renewing policies in Southeastern and Northeastern states.
The D.C.-based AAJ, formerly the Association of Trial Lawyers of America, put out its first such list on July 8. The organization created its rankings after “a comprehensive investigation” of SEC filings and legal documents, state insurance department actions and news re-ports.
Liberty Mutual earned its black mark, the AAJ says, largely from a spate of lawsuits from OneBeacon affiliates seeking more than $100 million in damages. The lawsuits arose after insurer OneBeacon sold its property/casualty division to Liberty Mutual in 2002. Afterwards, OneBeacon claims, Liberty Mutual went on a cost-cutting spree that led to poor claims processing and lawsuits from customers.
The report also panned the company for fighting allegations of corporate fraud, mentioning the recent scandals involving several large insurers: “While the likes of AIG, Zurich and ACE settled charges that they colluded with broker Marsh & McLennen in a huge bid-rigging fraud, Liberty Mutual remains the only insurance company that refuses to concede guilt.”
But Frank O’Brien, New England regional manager for the Property Casualty Insurers Association of America, scoffed at the report and the AAJ.
“Clearly, you have a list put together by people who make their living by suing and fighting with insurance companies,” he said.
“I would suggest that they have no love lost for the industry in general, so I would question the credibility of such a list Â… Frankly, I think I’d fall over in a dead faint if I ever saw a list from this type of organization praising an insurance company. It’s not what they do.”
Liberty Mutual did not return messages as of press time, but AAJ president-elect Anthony Tarricone of Boston’s Kreindler & Kreindler law firm said in a statement, “Massachusetts residents have suffered enough from the insurance industry’s practice of putting profits over policyholders. This report confirms our worst suspicions.”
A spokeswoman for the Massachusetts Attorney General’s office said she couldn’t speak to the credibility of the list, but that Liberty Mutual has received 60 complaints since 2005, in addition to a January settlement in which the AG’s office accused Liberty Mutual of deceptive marketing practices.
