Originally published by Chip Merlin .
Should any debtor hold on to money that is agreed owed? It seems like an absurd question, but in the insurance claims world, many insurance companies know that it is very profitable to “play the float.” Even the most famous insurer admits that “playing the float” is very profitable, as I noted in Playing the Float and the Wisdom of Warren Buffett.
There is an extraordinary need for regulators and the law to reflect a public policy that all insurers should pay claims as soon as they can determine amounts due. Partial payments of amounts determined to be payable should be the standard, and extreme penalties should be the norm for slow paying insurers seeking to wrongfully profit from “playing the float.”
Texas is a state where I practice law. It is a conservative state and they uphold a lot of conservative values – one is keeping a promise and paying on time. Texas statutes give insurance companies five days to pay claims after they are determined to…
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