Have Insurance Companies Lost Their Way: Who is Really Protected?

One might suspect that a Chicago medical malpractice lawyer would spend most of their education time learning the ins and out of the civil justice system while focus specifically on understanding the more common forms of medical malpractice-delving into the medical side of the issues. Of course understanding the procedural aspects of our legal system and close familiarity with certain medical issues is essential in the field. However, a third factor exists in virtually all Illinois medical malpractice cases-and most civil law cases generally-the complexities of insurance.

The truth is that insurance is at the heart of these issues, because the payment or non-payment of certain claims are often made by those at insurance companies. These companies are intimately involved in these Illinois medical malpractice legal proceedings from the very beginning. Far from being an entity that stands to the side and then provides payment per terms of its agreement after the fact, these entities delve into the details of the case, going well beyond their assumed role of general safety-net for those in certain situations.

Considering the role played by insurance companies in these affairs, our Illinois medical malpractice attorneys were interested to read a new article at The Atlantic. The story discussed the history of insurance generally, pointing out how today’s modern-day counterparts may be able to take a lesson or two from older traditions.

One company, Liberty Mutual, was used as an example. The company’s origins can be traced back over one hundred years-when factory workers were in desperate need of protection in case they were struck with the not-unlikely tragedy of a work injury. At that time, only about one in fifteen injured workers receive fair compensation from their employer. That is why, via hard-fought political wins, the organized labor movement was able to overhaul to worker’s compensation system state-by-state to provide support for those harms faced by ordinary workers. As part of that effort the Massachusetts Employers Insurance Association was formed-today that company is Liberty Mutual.

In other words, the company began as an entity to help ordinary workers. Has the primary focus on helping those in need remained over the centuries? Not quite.

The article explains that now, instead of being a mutual effort of ordinary workers helping one another, the company is beholden to a small group of executives to make decisions-not surprisingly-in their own best interests. This is almost undeniable. After all, how on earth is it possible to justify the fact that its current CEO received almost $200 million in pay over the last four years alone? The company clearly has different goals than those upon which it was founded.

It is about time companies took a harder look at the past and the underlying spirit of insurance.

The modern version of insurance is rooted in England in the early 18th century. It was then that Daniel Defoe endorsed the idea of the modern day insurance, calling it “a Number of People entring into a Mutual Compact to Help one another, in case any Disaster of Distress fall upon them.”

Insurance was supposed to be able helping those involved in times of need-not trying to avoid payouts as much as possible, making policymakers jump through hoops, and striving to increased profits for the executives at the top.

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