Think you're in good hands with your insurance company? Think again.

A recent research study by the American Association for Justice, "The Ten Worst Insurance Companies in America," makes it clear that one of the main reasons the top insurance companies are doing so well is that they have consciously embarked on aggressive policies to avoid paying out claims, whether the claims are justified or not. In other words, they will take your money, but when it's time for them to pay you, watch out.

Bottom line: insurance companies are more interested in collecting premiums than in paying claims.

The AAJ report notes that U.S. insurance companies annually collect over $1 trillion in premiums, and today the industry is sitting atop $3.8 trillion in assets (more than the GDP of every country in the world, except the United States and Japan). Their executives are handsomely compensated with C.E.O.'s receiving multi-million dollar annual pay and benefits packages. Without a doubt, the industry is doing well.

There is nothing wrong with insurance companies making a profit, but businesses that operate on the basis of contracts with their customers ought to live up to those contracts.

The number one offender on the AAJ list is Allstate, which employs a "3 D" strategy in dealing with its customers: deny, delay, and defend. Allstate's policy appears to be to litigate every claim—including meritorious ones filed by their policyholders—in the hope that it can wear out its opponents and get them to accept a minimal payment or drop their claim altogether. The result is the policyholder who paid the company a premium in good faith is left to twist in the wind. Former Allstate adjusters say they were rewarded for keeping claims payments low, even if they had to deceive their policy holders. So much for being in "good hands"!

Second on the "Ten Worst" list is Unum, one of the nation's leading disability insurance carriers. The multi-billion dollar company is headquartered in Chattanooga, Tennessee, not a place from which you would expect "sharp" practices to emanate. Debra Potter learned otherwise. She filed a disability claim because of her multiple sclerosis. Her claim was repeatedly denied even though her doctor backed up its legitimacy and the Social Security Administration concluded she was totally disabled. Unum denied her claim for three years, and only paid after she retained a lawyer. Continued...