Business Blog

Fisher vs. Progressive… the Case that Never Should Have Been

Matt Fisher was angry on August 13, 2012, and he had good reason to be so. His sister, Kaitlyn Fisher, was recently killed in a car accident in mid-June 2012. She was killed driving forward into an intersection on a green light by another driver running through a red light and hitting her car.

To make matters worse, Matt Fishers sisters car insurance company, Progressive Insurance, was actively trying not to pay out on the financial difference owed between its own car insurance policy for Matts sister and the amount of claim already paid by the other drivers insurance company, Nationwide.

Kaitlyns car insurance policy with Progressive had a clause providing $100,000 in coverage for damage by an underinsured driver. The car accident triggered that clause. By denying the claim to the Fisher family and Kaitlyn's estate, Progressive was effectively trying to hide behind a Maryland state law that essentially made it impossible to directly sue a car insurance company; instead the Fisher family had to sue the other driver in the accident for the difference owed. That said, Progressive then actively worked with the other driver's legal defense to deep-six the case filed by the estate of Progressive's insurance client.

Prior to the court case trial involving the Fisher family versus the other accident driver, Progressive did try to settle the claim. However, the company low-balled the financial payment to only one-third of what Kaitlyn Fishers policy agreed to should she have died in a car accident. The offer was at the least insulting to the Fisher family.

The irony in the case build up was added to further by the fact that Nationwide, the actual insurer of the other accident driver, decided the details were fairly clear in what happened. Nationwide settled immediately with the Fisher estate to resolve liability. Unfortunately, the policy involved was a budget type coverage of the bare minimum, $25,000, which amounted to almost nothing financially. Again, the lack of recovery from the driver triggers the underinsured driver clause in Progressives own policy for the remaining $75,000, which became the heart of the issue in court.

Because the State of Maryland does not allow a party to sue an insurance company directly for claims owed, the Fisher party instead had to sue the other driver and then use that verdict to force the insurer, Progressive, to pay up. In doing so, the filing set in motion an eventual conclusion against Progressive. That triggered the company to get into the trial fray. In fact, the trial had a special motion specific to allowing Progressive to join the defense's legal team since the company was not a named party in the trial up to that point.

The thinking behind Progressives legal move was essentially to avoid having to pay out the $75,000 claim difference. By helping the other drivers defense win their case, Progressive would continue to have no legal link to the accident liability and would therefore not owe any money to the Fisher family. While ethically, the whole affair reeked of dirty business, legally Progressives attorneys were fending off their clients liability on having to pay out any funds. Clearly, someone in Progressives management decided it was cheaper to fight in court than to settle the claim with the Fisher family.

Ultimately, despite Progressive throwing its chips in with the other accident driver against its own insurance clients estate, the Fisher family convinced a jury and won the case. According to the Wall Street Journal, its very likely now that the company will pay up on the remaining $75,000, also probably having to explain its unethical behavior to the Maryland Insurance Commissioners Office as well in the process. However, the Fisher case was one of many, so for every case lost in the above manner, Progressives management clearly believes the above approach is effective to save money on many other similar claims in Maryland.

In the meantime, when Matt Fisher vented his opinion of Progressive on the Internet on August 13, 2012, with full detail of the case particulars from his opinion, it caught peoples attention. In fact, it caught so much attention Progressive soon found itself wheeling backwards from a public relations problem gone viral.

Theres a funny thing about Internet controversy; it doesnt respect boundaries. The sentiment expressed by readers and the general population took a life of its own against the company, possibly costing Progressive new customers and maybe some old ones too.

Obviously, what people post on social media was not going to affect the outcome of the case in court, but it is potentially affecting Progressives bottom line via viral dissemination. If the story continues to travel and gain media attention, Progressive could be dealing with the outcome from the Fisher case for months to come.