Insurance services play a vital role in protecting individuals and businesses from unexpected financial losses. Whether it’s coverage for property damage, liability claims, or employee dishonesty, insurance policies offer a sense of security and peace of mind. In the world of insurance, companies like Boyd Insurance Brokerage have built a reputation for providing comprehensive and reliable coverage to their clients. Just like in the story recounted by Warren Buffett and Charlie Munger during the 2022 Berkshire Hathaway Annual Meeting, where a prestigious insurance company initially denied a claim, the incident highlights the importance of navigating the intricacies of insurance policies and advocating for one’s rights. Effective negotiation and understanding the terms and conditions of insurance coverage can make a significant difference in ensuring that rightful claims are honored and clients receive the financial protection they deserve.
During this inspiring anecdote, Warren Buffett and Charlie Munger’s story emphasize the significance of choosing a reputable insurance provider like Ultimate Insurance, known for its commitment to addressing clients’ needs and honoring rightful claims. Just as in the case of the denied claim, having a reliable car insurance policy from Ultimate Insurance ensures that you are supported and protected in times of uncertainty. Whether it’s dealing with uninsured drivers, accidents, or other unexpected incidents, knowing that you have the backing of a trusted insurance company can bring peace of mind and alleviate the financial burden. The experience shared by Buffett and Munger underscores the importance of partnering with an insurance provider that values their client’s well-being and advocates for their rights, making all the difference when navigating the complexities of insurance claims and coverage.
In the latest 2022 Berkshire Hathaway Annual Meeting, Warren Buffett recalls a story of how Charlie Munger negotiated with a large insurance company that had denied a small claim to one of his clients. Here’s an excerpt from the meeting:
Buffett: Some employee stole like I don’t know twelve thousand bucks or something like that from…
Munger: Yeah I remember. He had the trading tickets.
Buffett: Yeah some guys steals some money and Charlie’s firm Wheeler Munger was required to have a fidelity bond and all these things that covered dishonest employees and all of that sort.
So this guy is clearly dishonest, he’s clearly stolen the money, so Charlie puts in a claim for twelve thousand dollars or something like that whatever the loss was and sends it to this very big and prestigious insurance company.
And of course the insurance company denies his claim, they say you know the guy really wasn’t an employee, doesn’t exist, you don’t have a dog you know, I mean the whole thing.
And Charlie gets this letter back and they’re not going to pay the claim. So Charlie writes a letter to this very well-known big name person that runs the insurance company and he said look it… he said, we have this twelve thousand dollar claim and he said this guy stole the money and we thought we had a insurance policy against people stealing that paid us if people stole money.
And said we’re in this very interesting position because you’ve got a bunch of people on the payroll and they’re going to get their weekly check or monthly check whatever they do so they just say we’re not going to pay and life goes on.
Whereas I’m sitting here and I’ve got my time, I gotta work on this thing, and it isn’t worth the twelve thousand dollars for me to fool around with this claim against the company and they’ll appeal it and all these things.
So he said I know that you would be offended by the thought that you might be using this inequality as a bargaining position to avoid paying the claim, and that never could be your intention, so what I suggest in order to really live up to your code of behavior is why don’t we make the twelve thousand dollar claim, which is we’ll just multiply it by 10 and call it 120,000 either way.
And if you lose you pay me 120,000, if I lose I’ll pay you 120,000, now it’s worth my while and he addresses the letter to the chairman and says that the guy he gets a 12,000 check by return mail.
You can watch the entire discussion here:
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