Chapter 1
The Playbook: Delay, Deny, Defend
Since 1995, major carriers have systematically weaponized claims processing.
The result: homeowners exhaust themselves into accepting pennies on the dollar.
The McKinsey Three D's — Documented Since 1995
Allstate hired McKinsey & Company to redesign claims handling. The strategy: Delay every step, Deny as much as possible, Defend in court when challenged. Income increased 30x. Payout ratio dropped from 69 cents to 43.5 cents per premium dollar. Every major carrier adopted the model.
83.9%
Of closed State Farm suits end with consumer receiving payment — yet SF maintains 3,416 pending suits
25.7%
State Farm suit rate — 4x the industry median of 6.5%
14.6
State Farm DRS (Dispute Rate Score) — CRN filings per 1,000 policies
$11,200
State Farm's initial offer on a $65,000 claim — 17% of actual value
Why Litigate When You Pay 84% of the Time?
Because it works. The 18-month litigation gauntlet forces 95%+ of homeowners to settle for far below their claim value. The 83.9% consumer payment rate includes settlements where homeowners accepted 40-60% of their actual loss just to end the process. The carrier wins by making the process unbearable.