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State Farm Wrongfully Denied Katrina Claims

Ricky Bagolie
Ricky Bagolie
Contributor
Posted by Ricky BagolieSeptember 01, 2006 10:08 PM

Is anyone surprised that a giant insurance company has defrauded it's customers to increase profits? A Houston Chronicle article reports that two sisters working for a State Farm contract company revealed the company's fraudulent tactics to deny Katrina victims' claims. According to their lawyer, the company manipulated engineers' reports of storm damage. Several reports were based on a "cookie-cutter" template that concluded water or wind-driven storm surge was responsible for damage.

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Joel Smith
Posted by Joel Smith
October 23, 2006 8:35 PM

My comments are observations about State Farm and its contractor staffing practices in general.

I myself worked as a State Farm contractor in their IT department, at their corporate headquarters in Bloomington, Illinois.

The first thing I noticed was a clear 'two class' system in their work environment. Contractors wear blue badges whereas the real employees wear red badges. These blue contractors are everywhere, it appeared to me almost half or more than half of their work force. What is more, a HUGE percentage of these were Indians on H-1 licenses. I like most people out of work was simply looking for a job, had applied for the real jobs but couldn't get hired any other way.

State Farm has done well in my opinion in creating an enormous, disposable labor force with practically no rights or job security. Real employees are even forbidden by company policy from socializing with 'blue badge' employees. I found what I thought was a country club environment where 'red badgers' called in sick, took frequent vacations while the blue badge force handled much of the dirty work- fearing for their jobs. Also I saw 'blue badgers' who weren't liked socially who disappeared, regardless of their work ethic.

As for my personal experience, I literally found my access card turned off one evening, locking the door behind me. This was after I had completed a large project of several months. My contracting company then phoned me and said State Farm 'liked my work but no longer needed me in that department.' I was forbidden to phone or contact any of my co-workers (it was explained this would make the real employees feel bad) and even had to wait days for my belongings to be returned.

It was ironic that my belongings included an assortment of State Farm calendars, pens, and other items I had purchased as someone who had been proud to be part of their team. What a horrible display of the inhumanity of a large company.

So I say, hats off to those contractors, good work in turning in those rats!

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