I came across this very interesting report over the July 4th weekend and thought I should share it with our readers. We mostly receive positive comments about companies, but we should be aware about the negative side as well. This is just for your curious reading–your feedback and actual experience with these companies will be highly appreciated.

To identify the worst insurance companies for consumers, researchers at the American Association for Justice (AAJ) undertook a comprehensive investigation of thousands of court documents, SEC and FBI records, state insurance department investigations and complaints, news accounts from across the country, and the testimony and depositions of former insurance agents and adjusters. Our final list includes companies across a range of different insurance fields, including homeowners and auto insurers, health insurers, life insurers, and disability insurers.

The Ten Worst Insurance Companies

1. Allstate
2. Unum
3. AIG
4. State Farm
5. Conseco
6. WellPoint
7. Farmers
8. UnitedHealth
9. Torchmark 
10. Liberty Mutual

http://www.justice.org/resources/AAJ_Report_TenWorstInsuranceCompanies_FINAL.pdf

Time magazine had a wonderful article explaining why the life insurance industry is so much safer than all the other financial service industries. The article explained that insurance companies only held about ten percent of total assets in the real estate investments that pulverized the bank and investment industries. The article even explains that AIG, the insurance company, was solvent because of insurance companies and life insurance part of the business is still solvent according to New York state insurance department. Insurance companies are  required by law to have money set aside to pay claims. That is very different from credit default swaps, which had no money set aside to pay claims. It also explains that insurance companies contribute to state guaranty funds, which come into play when an insurance company becomes insolvent. This make life insurance ideal not only for death benefit purpose but also for safer savings and risk management purposes. Learn more about whole life insurance, term life insurance and find the best life insurance rates and term life quote & whole life quote.

http://www.time.com/time/business/article/0,8599,1849023,00.html