USAA Changes Policy After ABC News Investigation Into Sandy-Damaged Vehicles Sold on Used Car Lots

[alp227]

Source: ABC News

In the wake of an ABC News investigation into superstorm Sandy-damaged cars being sold on used car lots, a major American insurance company acknowledged that its salvage vehicle branding process after Sandy was "unsatisfactory," and it is making changes to help keep those damaged cars off the road.

USAA, which focuses on providing financial services and insurance to U.S. military members and their families, is now facing questions, which were raised by an ABC's "The Lookout" report in July, over its failure to brand at least one of its flood-damaged vehicles -- a 2006 Ford F-350 -- as a salvage vehicle before selling it at auction.

In a follow-up interview with "The Lookout's" Bill Weir, Kevin Bergner, the president of USAA's Property and Casualty Insurance Group and a former Army general, said the team's report was "shining the light on something that is troubling all of us."

...

When superstorm Sandy pummeled the Northeast last October, the damage was widespread. Nearly 300 people lost their lives, and thousands more lost their homes. Then there were the cars. According to the National Insurance Crime Bureau, an estimated 250,000 cars were submerged for days in corrosive saltwater.

Read more: http://abcnews.go.com/US/usaa-policy-abc-news-investigation-sandy-damaged-vehicles/story?id=20156236&singlePage=true

[Spitfire of ATJ]

1. There were flooded Katrina cars that got sold too.

[jtuck004]

2. ? "salvage vehicle branding process". Could just shorten it to "fraud". n/t

[malokvale77]

3. Well...

then somebody might go to jail.

We can't have that.
It's called free (as I can do as I please) enterprise.

Do I need the sarcasm thing?

[jtuck004]

5. >Do I need the sarcasm thing?< Not with me. n/t

[malokvale77]

7. Good

So many here don't understand sarcasm, irony or dry humor.

Not to mention everything else.

[Paulie]

12. Pardon me, but do you have any Grey Poupon?

[sendero]

8. Exactly..

... this allowed them to sell the vehicle at auction for double what it would have fetched with a salvage title. Sure, it was an "accident".

[silvershadow]

10. They could, but then they would be self-reporting. nt

[RobinA]

11. I Like That

"salvage vehicle branding process." Sounds so innocuous. Just a step in the "process." A minor paperwork error. Oh, sorry, "error" is so fraught. A minor paperwork glitch. No red flag words. I ignored it myself when I read the OP for the first time. Just the usual meaningless corporate drivel, signifying nothing.

[Manifestor_of_Light]

4. Insurance companies buy politicians.

Just like Walmart, oil companies and other corporations.

We have government by, of, and for the corporations.

[cstanleytech]

6. Sadly true. nt

[hobbit709]

9. I doubt USAA was the only one.

[Blue_Tires]

16. +1000

[wilt the stilt]

13. this is a sleazy company

one of their drivers backed down a parking lot and hit me and the policeman said to the driver that he would have given him a ticket. they denied my claim.

[happyslug]

14. Till 1996, it restricted its coverage to Military Officers

Last edited Thu Sep 5, 2013, 11:15 AM - Edit history (3)

In 1996, USAA extended its coverage to enlisted personal (Due to the cut back in the Military at the end of the Cold war, the number of Officers dropped severely, thus USAA had to expand its base, i.e .include enlisted personnel, OR become a much smaller company. Thus to at least stay the same size, it expanded its coverage to enlisted personnel).

Sorry, I had to deal with them in the 1980s, and they attitude at that time, reflected that Officers attitude that they are better then the enlisted ranks.

Another problem is that it is NOT a Stock Insurance Company but a non-accessible Mutual insurance company. In an accessible insurance company, all insured insure each other and the annual premium is based on the claims made by members of the group to the insurance company. If the claims are more the the premium paid each year, the mutual insurance company can go back to all of its members and force them to pay again due to the excess payouts. This is rarely done, but being able to do so permits them to charge smaller premiums then in a Stock company and in most years that is enough.

In a non-accessible mutual insurance company (such as USAA) the insured are still insuring each other, but can not be hit for any excess payments made in any year.

This difference, put pressure on non-accessible mutual insurance company to keep claims down so their premiums can be competitive with accessible mutual insurance company. This is the main reason people have a problem dealing with USAA and other non-accessible mutual insurance companies. Stock insurance companies are the easiest Insurance companies to deal with when it comes to a claim against someone insured by them (They pay out quicker and come to an agreement quicker) The worse are these non-accessible mutual insurance companies (The accessible mutual insurance company are in between). I have talked to attorneys that they hate dealing with mutual insurance companies, for at time even if you the insured you have to sue the insurance company to pay for covered damages. This is less likely if they are dealing with a Stock Insurance Company.

Just a comment on USAA and similar non-accessible and accessible mutual insurance companies.

Some more on USAA:
http://en.wikipedia.org/wiki/USAA

[CountAllVotes]

15. USAA is also incompetent

I was directed to them by my credit union being my father was in WWII and spouse in the Korean war.

They claimed to have opened up an account for both of us and the problem is that said accounts cannot be found/do not exist.

Good going there for a batch of incompetent fools that know not what they do -- most of the time it seems to me that is unless you count the fact that they must be hard up for $$$ being they are selling used cars left over from Sandy, etc.

Screw USAA and bank elsewhere, military or not!