When helping people regain or gain control over their lives and subsequently their relationships surrounding their child custody cases I find it necessary to get to the root of the hindrances to their independence. The scripts, norms, and ethos that influence us as individuals are often developed by those who are likely to experience the greatest gain from our greatest loss. The purveyors of these contradictions are usually marketers representing some commercial interest. I have previously exposed ways in which perceptions are tainted by advertising and continue with such today as I target Liberty Mutual Insurance Company.
Incidentally, this is not my first disputation against Liberty Mutual. Previously this company has raised my ire over their portrayal of fathers and promoting a cultural bias favouring custody of children in their mothers.
Recently, Liberty Mutual has been running a series of commercials related to indemnity coverage that is typically provided by insurers. The commercials show purported drivers who had recently purchased a new vehicle and were soon thereafter involved in a collision in which their vehicle was totaled by another driver who was at-fault. They are then portrayed as being disgruntled about the compensation received for their vehicle and then pose these two queries; how can a car be worth thousands of dollars less than sticker price before it has had its first oil change, and; why do insurance companies “punish” drivers for getting in a wreck that was not their fault.
In this monograph I provide the simple and logical answers to these questions that will also be beneficial in helping you better identify paralogisms, particularly those related to child custody matters.
Consequences to a voluntary action with a known range of potential results and corresponding probabilities, or rather acceptance of risk, is not punishing someone as Liberty Mutual implies. Punishing is that which is very demanding either physically or emotionally. To punish someone, as Liberty Mutual contends the act of not compensating someone for the purchase price of a vehicle destroyed soon after, is to subject somebody to a penalty for doing something wrong. Doing something wrong is to contravene the ethos or morality of a community or people.
First thing first, is that these querulous people should be grateful that the collision which totaled their vehicles apparently left them unscathed emotionally and physically. In 25 Years Ago Today I Died I wrote about the vehicular collision which took me nearly 20 years from which to physically recover yet I remain positive in my mental perceptions of that event. Beyond being ingrates, the characters in the Liberty Mutual campaign with their splenetic attitudes possess some misconceptions about risks, responsibility, and the aspects of what constitutes living.
In child custody disputes I encounter parents who display similar indignation or hold like beliefs as the Liberty Mutual characters about what is owed to them. Life involves risks, responsibilities, adversities and rewards among other aspects. Life is neither equal for similarly situated people nor is it equitable. You may get in a collision wherein another driver is legally culpable. Conversely, you or someone else in the same circumstance may not. It could be nothing more than one potential driver coincidentally looking directly at the oncoming wreckless driver and avoiding him while the other potential driver peers down the opposite direction of the cross street and gets struck. If you get struck in your relatively new vehicle -- less than one month/one thousand miles -- the insurance carrier will pay market value for the vehicle. That is not enough to replace that vehicle because the only replacement vehicles are dealer new. To answer the query of the Liberty Mutual character about why the replacement value isn’t paid it is necessary to understand the market. * * * * * * * * * * * * * * * * * * * * * * * * * * * * * * *
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Inclusive in the new price of a car is the implicit or explicit guarantees of the dealer not found with used vehicles sold either privately or through a dealer. If you were able to find a vehicle with less than 1000 miles for sale which had a previous owner you would likely wonder why. Why had it been ditched so soon? That doubt has a cost in the market. Thus a car’s depreciation is much more rapid relative to its use initially. This had been the purpose of the down payment which was the equivalent of the immediate depreciation upon sale. When operating a vehicle on the public roadways you are accepting the terms of the agreement with your insurance carrier as well as the statutes and established case law relating to motor vehicle torts. These include receiving ‘fair market value’ for your loss.
The other query is why am I being punished? No one who receives compensation from an insurance company, regardless of whether it is sufficient to replace the vehicle, is being punished. But Liberty Mutual is attempting to alter viewers perceptions of what is a punishment. Underlying this attempt to instill a new perception of consequence is the greater scheme of eliminating risk. But as any investor knows risk produces the greatest rewards. Liberty Mutual along with a consortium of other commercial enterprises seek to capture the rewards for themselves that consumers relinquish by spending more money for guarantees.
This commercial uses the framing of assuming there will not be a loss [no one should experience adversity] if you are in a collision. In this scenario people will make a higher payment to secure the full value of the asset. If it is framed as an expected loss if a collision occurs [that’s life] then people will assume a proportional risk by paying a lower premium.
To arrive at how framing affects the decision making process assume these two scenarios as absolutes.
Scenario A is Liberty Mutual’s policy in which policyholders assume they will never have a loss. In this scenario the amount that Liberty Mutual pays for the depreciation of all vehicles totaled in collisions will be exactly equal to the money received from the higher premiums paid on all policies.
Scenario B is other insurers policies in which policyholders assume they will have some loss from depreciation. In this scenario the amount that policyholders pay for the depreciation of all vehicles totaled in collisions will be exactly equal to the money saved by paying the lower premiums on all policies.
In a study of framing effects[en1] the respondents would have chosen Liberty Mutual’s policy by 78% to 22% if it was presented as no one should experience a financial loss from a collision. When framed as though a loss from depreciation is just part of life then the results were nearly reversed with only 28% in favour of Liberty Mutual and 72% in favour of traditional coverage. Thus, Liberty Mutual must reframe your expectations to effectively sell their service. That is they must convince you that life should not involve risk and therefore you are better off by subjecting yourself to greater costs to guarantee this elimination of risk.
Pecuniary matters are not my greatest concern here though. The greater harm from this shift from accepting risk is the corresponding change in attitude that Liberty Mutual attempts to perpetuate. Liberty Mutual’s characters belie the psychological effect. In essence it is not the financial compensation that is at issue, although that is the method used, but the perception of what is deserved. These characters are demanding that their situation be restored to such that they were in prior to the collision. They insist that they deserve this because they were not at fault. And they are willing to pay more to do so.
It is this attitude that pervades high conflict child custody disputes for which there is a corresponding cost. Divorce or separation usually involves mutually instigated destructive action, more than most parents are willing to admit. Even in cases where one parent was overwhelmingly at fault this does not entitle the other parent to any special considerations. Underlying many disputes is perceived financial deficiencies or the control over financial matters. In cases or divorce both parents will experience a financial loss and reduced standard of living. It simply cost more to operate and maintain two households as opposed to one. The Liberty Mutual characters are of the mindset that the parent who is not at fault should have his or her lifestyle completely maintained as it was with costs imposed upon the at-fault parent. Such is not reality though. Getting married to or being a cohabitant with another which one has a child in common is taking a risk. Having a child is taking a risk. Living involves risks. Risk sometimes results in great cost.
Now indulge me as I present financial costs in a different context. Free enterprise or free markets are an extension of liberty. That is people are allowed to have the freedom to purchase the goods and services which they desire. Taxes and other fees which are usurped from the individual and dedicated to a purpose which he has no direct say in is a deprivation of liberty. The more one pays in taxes the less liberty he has. Likewise, the same can be said of necessary expenses. There is a certain amount of resources that although we can direct the manner of spending still are dedicated toward spending. That is, we can choose which grocery store or what food but we still need to eat. The result is that we have two types of spending; discretionary and non-discretionary. Our discretionary spending is our liberty. Thus, by dedicating a greater amount to non-discretionary expenses we deprive ourselves of some liberty.
Demanding guarantees and surety against the costly adversities that are typical of living comes at a cost which is liberty. Carrying this attitude into child custody proceedings will perpetuate conflict. Those who have done it know of the financial toll. They have also experienced the loss of liberty as judges are forced to craft plans for custody and parenting time that are less convenient and more expensive to both parents than if they had made an agreement themselves. A Liberty Mutual policyholder is the type of person who will perpetuate a custody battle on principle, the principle of rightness and that he or she does not deserve to be saddled with any of the costs associated with the risk of divorce or separation. The risk of the relationship is that it may end.
Conversely though risk sometimes produces wonderful rewards. Those rewards include the children as well as the financial benefits of cohabiting. If you have experienced divorce or separation then frame it as the elimination of the benefits of the relationship rather than a loss associated with the demise of the relationship. By doing so you should experience less dissonance and conflict. Those who want to entrap themselves in the abyss of perceived guarantees can enslave themselves to the costs of satisfying their desires and submit to a phlegmatic mind devoid of the excitement that life can offer. People with greater felicitous behaviour enjoy life more.
So if you already have a policy with Liberty Mutual I suggest dumping it in favour of a company that is more scrupulous, has intelligent people behind it, and embodies the principles that effectuate better parent-parent and parent-child relationships.
 Kahneman, D., & Tverksy, A. (1984). "Choices, values, and frames". American Psychologist 39: 341–350.
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