What happens when an insurance company decides to not honor a legitimate claim? 98% of the time, the victim gives up.
For the 2% of the cases where they take the insurer to court, the insurer can deny and delay, as they did with my family for four years. Finally, they bury the judge under pounds of paper and argument, distracting from the real issues. Insurance companies can exhaust the resources of the everyday person.
But can they exhaust a crowd? We're trying to show that people care about injustice, and prove to the insurance companies that denial doesn't pay.
Also, we used Strikingly, a YC company, to make the website :-)
With all due respect, how will this help others in the same situation?
How will you establish a multiplier effect for donations?
How will a donation continue serving the cause in perpetuity?
How would a donation help me, if I got into a similar situation?
Even if the insurance company loses, they aren't going to suddenly come to the realization that they've been wrong all along, and start paying out more frequently.
I guess I don't see what this crowdfunding campaign is selling which would serve the greater good. Funding the EFF means that you're contributing to the greater good of privacy, etc. Funding the ACLU means that you're contributing to the greater good of civil rights, etc. Funding this campaign means that a single person can't or won't find a lawyer under any payment arrangement, contingency or otherwise.
Foremost, I think that this will create an example. Wronged people will learn that they have another avenue to lean on; crowd funding. Insurance companies will learn that they cannot use the tactic of delaying and denial to exhaust a person's resources, without risking much more public disgust at how they've handled the situation.
Beyond that, what we hope is that this example will inspire a new form of insurance. In previous eras, insurance was managed by a local community. With modern social networking and crowdfunding systems, there is an opportunity for an Insurance 2.0; reliant on genuine social fabric to help people recover after loss. And instead of an experience consistent of abandonment and confrontation, the story will be one of the community rallying together, and everyone getting closer with each other because of it, developing real connections.
This crowdfunding campaign is just the first step -- a trial -- but if there is a really good response I think it will meaningfully show that people are fed up with the injustice of the current system and willing to help with their money to fight it. Insurance needs to be reformed, and this could be incite the movement to do it. There is the opportunity for a great startup to be formed -- honest insurance is something that people want.
So you're going to use the money to sue the insurance company. People sue them all the time, and it doesn't change their business practices. Those people could use more money, too. So what makes you and your case different from them and theirs?
Insurance 2.0, crowdfunded payouts... You talk about a lot of things that you think will happen, or hope will happen. Now tell me how you're going to MAKE it happen.
You're going to start an insurance 2.0 company. You're going to start a crowd funding nonprofit foundation for people spurned by their insurance. Tell me how this is a donation, rather than a handout.
Mr. Hoffman, you are right to desire specifics, but you are dragging them out of me. Insurance 2.0 is a problem we want to solve, but we are not in a position to pitch a business plan today!
We both run companies which require our attention. We have this lawsuit. To make insurance 2.0 work it will require scale, capitalization, and attention.
I take commitments seriously. Here is what we can commit to, today.
- in my capacity as a mentor of entrepreneurs independently and with the Thiel Fellowship and more recently YCombinator, and with my connections to major investors, I will do my best to advise, connect, and promote people working on this problem or struggling with it.
- as a first step to insurance 2.0, we will put ourselves in the shoes of others that have experienced this and offer to help them directly and manually launch their crowd funding campaigns.
- when it is possible to launch an insurance 2.0 company, given our other commitments, I will (unless someone already has definitely cracked this problem). I cannot make commitments as to the model because we have not yet thought it through or tested it adequately, but it is a huge problem in a legally mandated industry, and we must do better.
For the 2% of the cases where they take the insurer to court, the insurer can deny and delay, as they did with my family for four years. Finally, they bury the judge under pounds of paper and argument, distracting from the real issues. Insurance companies can exhaust the resources of the everyday person.
But can they exhaust a crowd? We're trying to show that people care about injustice, and prove to the insurance companies that denial doesn't pay.
Also, we used Strikingly, a YC company, to make the website :-)