The Farm

A plantation mentality lives on...

Looks like State Farm is borrowing--with some modification--a page or two from the Team Bush playbook...in the latter case, some $20 billion dollars of insurance claims is misidentified as "relief aid," while, on the private side, they've opted for a more primitive approach: shred the documents.

Unfortunately for "The Farm," they made a small mistake. They butted heads with one of their own: GOP Senator Trent Lott (h/t America Blog):

A lawyer for U.S. Sen. Trent Lott said Monday that State Farm Insurance Co. is destroying documents that could show the insurer has fraudulently denied thousands of claims by Lott and other policyholders whose homes were destroyed by Hurricane Katrina.

Zach Scruggs, one of Lott's attorneys, says his client has a "good faith belief" that several State Farm employees in Biloxi are destroying engineering reports that gave conflicting conclusions about whether wind or water was responsible for storm damage.

Like thousands of Gulf Coast homeowners, Lott's claim was denied because State Farm concluded that Katrina's flood water demolished his beach-front Pascagoula home. State Farm says its policies do not cover damage from rising water, including wind-driven water.

But lawyers for the Mississippi Republican claim Bloomington, Ill.-based State Farm has routinely pressured its engineers to alter "favorable" reports that initially blamed damage on hurricane's wind, which the company's policies cover.

A State Farm spokesman said Monday he couldn't immediately comment on Scruggs' allegations.

Lott's allegations come on the heels of a lawsuit filed by Kiln, Miss., couple who claimed they had obtained copies of conflicting reports prepared by State Farm's engineers on what damaged their home. They said one report traced the destruction to Katrina's winds while a later report said flooding was the culprit.

In response, State Farm spokesman Phil Supple had said the second report was the only one the engineering firm sent to State Farm's claims office.

In an interview Monday, Scruggs said corporate "whistleblowers" who are cooperating with Lott's attorneys have provided evidence that State Farm employees are destroying or moving those "initial favorable" engineering reports.

"We believe that this is a systematic practice," said Scruggs, who is Lott's nephew by marriage.

Mississippi Attorney General Jim Hood also says he is investigating allegations that State Farm manipulated engineering reports to deny claims after the Aug. 29 hurricane.

You know, I'm not really all that surprised. I've got personal experience with insurance companies denying claims (in my case, they simply denied all my medical claims for approximately a two year period--these denials came after I moved and changed jobs, leaving me with two alternatives: either pay up the roughly $700 or get caught up in the never ending malestrom of answering machines, button pressing on the phone, and endless hold times, etc. etc. ad nauseum, and fuck 'em, the bastards). It's just another example of yer free market in action. They carp and whine endlessly about how "efficient" the system is...and this is a prime example: divide and conquer, use an army of employees to take on one individual at a time, stall, deny, stall some more, and so on. If they need to lie a little bit, well, that's not such a big deal, and if they get caught, take the wrist slap and move on. In the end, they've "protected"...their shareholders.

And now the gang in DC is applying the same business model to the government. Rinse, repeat...and enjoy.