Closer look deters arsonists, discovers scams,benefits all policyholders
Kenny Allen was alikable fellow. He went to church, coached youth basketball in the Muncie, Ind.area, and was making his way through life with limitless potential ahead.
He also lived in asecret world: He was an insurance thief. Kenny was a driving force behind thelargest home arson ring in Indiana history. And one of the largest ever in theU.S. His gang helped torch at least 73 buildings while he sang hymns ofrighteousness in pews.
Insurers were easy todefraud, Allen says. Their adjusters were so intent on making customers happy —he contends — that they rarely asked tough questions. Insurers could’ve quicklyexposed the claims for burned homes as money grabs with a little more effort.
Kenny went straightafter nearly five years in federal prison. He admits he screwed up, and todaygives workshops for investigators to help make amends. He partners with MikeVergon, the former ATF agent who arrested him. They’re friends and supportersin life — a touching story of Kenny’s redemption.
Yet his saga speaks toa bigger dilemma for insurers. If they investigate too many claims too closely,they risk policyholders thinking they’re cold and money-grubbing.
If insurers let too many suspect claims slide through tooeasily, they risk being prey for hunters like Kenny was. This slippery slopecan grow fraud losses, help raise premiums and — yes — reinforce a belief amongmany consumers that insurers are cold and money-grubbing.
Life isn’t always fairwhen you’re an insurance company, no matter how many good deeds you perform. Corporations aretargets of consumer upset simply because they’re big and make money.
Checking closely intosuspicious claims can trigger a lot of emotions. Fair or not, people’s feelingsof aggrievement or entitlement can quickly damage an insurer’s reputation.Especially when viral social posts can reach millions of sympathetic consumersin just hours.
Over the longterm,it’s a risk worth taking, and a story worth telling.
Insurers should do afar better job of telling people why they fight fraud — and why allpolicyholders benefit.
Being justifiablyknown for protecting policyholders from thieves seems like a pretty good way tobuild a business brand. And doing right by consumers.
If Kenny Allen’sright, taking the easy way out could’ve cost insurers more than millions infalse arson claims. He’s the first to admit, it’s a miracle nobody died in hisfires.