ED Magedson – Founder
Frankenmuth InsuranceOne Mutual Ave Frankenmuth, Michigan United States of America
Frankenmuth Executives use policyholder money to take the board of directors on week long luxury trips right before the board of director's anual meeting. They've gone to places like Vegas (The Winn) or Cabo and stayed at the exclusive One and Only Palmila. Not only do the board and executives go, but their spouses go, compliments of the policyholders - all the while, Frankenmuth is lobbying for higher insurance premiums for policyholders. The board meeting takes maybe a couple of hours yet the trips are for a week, wherein the board members and spouses are entertained, wined, dined and then go to the meeting on the last day of the trip where they vote on executive pay and bonuses? I feel this is a huge conflict and that the policyholders should be enlightened - particularly when this company claims it can't make money and needs rate hikes. How about reducing the spending on unnecessary luxury items that could be conceived as nothing more than "bribes" to the board members in exchange for voting on higher pay and bonuses. Of course that would explain why the recently retired CEO was able to build a 12,000+ sq foot house on Bay Harbor after purchasing the lot for about 1 million. Policyholders should look at the behavior of the executives and board members when considering where to place their money and trust. It's in my opinion, a HUGE conflict of interest and not at all in keeping with the fiduciary duties entrusted to people in these high positions. I don't think anyone begruges a for profit company making money but I personally don't expect them to engage in such blatent excess with the perceptions of conflicts and payoff's to board members for personal gain.
AM Best just downgraded Frankenmuth. Below is an article calling in to question alleged bribery of a judge by Frankenmuth to avoid a claims payment. Don't know if it's true but readers can form their own opinion...
The second link is from the Michigan Work Comp Agency - showing that Frankenmuth disputed 99% of the WC claims filed! You wouldn't think they'd need rate increases if they never pay claims - maybe the one that slipped through and accidently got paid was a big one?
This report was posted on Ripoff Report on 07/07/2010 04:31 PM and is a permanent record located here: http://www.ripoffreport.com/reports/frankenmuth-insurance/frankenmuth-michigan-48787/frankenmuth-insurance-frankenmuth-mutual-frankenmuth-insurance-group-engage-in-conflict-o-621212. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.
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