THE CONSUMERIST MANIFESTO BLOG

Having The Last Laugh for Bad Products, Poor Services and Broken Promises

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September 10, 2010

Tags: California earthquake insurance, CHUBB

Follow Up: CHUBB Botches Cover Up, Admits Error

CHUBB admitted in a phone call to me yesterday that the package with an “offer” for earthquake insurance (see my last post) was an attempt to correct an earlier “system error” that caused “policies [to be] issued with an incorrect rate.” I was not alone: All California CHUBB homeowner policyholders got the same letter.

To their credit, two amiable CHUBBers from Customer Service agreed it was “a bad letter.” And, yes, the response page—buried in the 13 page package—could have been mistaken as a warning that, if I do not quickly check one of the YES boxes before an earthquake shakes up my place, I’ll be sorry and it will be my own fault. It also has a NO box that allows me to say I do not want earthquake coverage—even though I have it.

It all seems daft until it looks deft: Boiled down, the CHUBB service duo (a) assured me I do have earthquake protection and (b) revealed the system error meant CHUBB owed me $14—unmentioned in the package. A consumerist like me wonders: Might this have been a way for CHUBB to dodge the trouble of sending me a $14 refund with a straightforward explanation? As well as all the other California customers? Expand the service to cover the accidental rate increase?

The insurance industry spends millions in “public service” promotions to warn us of the dangers of government involvement in their industry. You know, inefficiency, bungling bureaucrats doing mindless things—like sending 13 page packages that shroud an error by leading the victim to think he is responsible for the peril described?