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Unfair and Deceptive Practices in the Business of Insurance: An Update

Unfair and Deceptive Practices in the Business of Insurance
Unfair and Deceptive Practices in the Business of Insurance

A pedestrian accident caused serious permanent injuries including a skull fracture.  But the pedestrian’s claim met aggressive defense by insurance companies, tactics held by a court to be unfair and deceptive practices in the business of insurance.

A Massachusetts Superior Court actually reconsidered and increased its initial penalties.  In Anderson v. American International Group, Inc., et al. the court held insurance company conduct “egregious” where witness testimony was actually coached and manipulated.  Three insurance companies took part in the case.

Unfair and Deceptive Claims Settlement Practices

An internal investigation in the insurance claim file categorized the injury as serious and stated: “I don’t believe that any viable liability defense exists.”

But facts didn’t stop the insurers from pushing what the court called “fictitious facts, and improper manipulation of crucial witness testimony.”


In April, 2014 the court doubled the original jury verdict based on unfair and deceptive practices in the business of insurance.  Double damages, the court explained, are generally reserved for egregious cases in which an insurer has engaged in intentional misconduct, has made knowing misrepresentations, or has acted with “studied indifference” to the rights of a claimant.

In June, 2014 the court increased the judgment by tripling the damages.

“It was, and remains, the Court’s intention to assess the largest possible monetary sanction against these Defendants in order to punish them for their prior conduct and to deter them, to the greatest extent possible, from engaging in similar conduct in the future.”

But the court reconsidered the doubling of the initial verdict, holding instead that the actual maximum penalty under the law is three times the amount of the underlying judgment, with no credit for the fact the underlying verdict was paid.

The final judgment: $10.9 Million.  The court also awarded the attorneys’ fees of $1.2 million and costs in the amount of $85,000.

This may or may not represent the final word on the case.  Defendant insurance companies filed timely notices of appeal.

Laws of unfair and deceptive practices in the business of insurance vary widely from state to state.  This case represents Massachusetts insurance law.


This article updates our previous post on the initial court decision detailing unfair and deceptive practices in the business of insurance in this case.  That article is available here.  This blog will monitor and post future developments.

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Attorney Myers is a member of the American Trial Lawyers Association, Massachusetts Academy of Trial Lawyers, and New Hampshire Trial Lawyers Association. The Law Offices of Andrew D. Myers offer a broad range of legal services in personal injury cases in Massachusetts (MA) and New Hampshire (NH) areas.

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