Matt Fisher posted a blog on Tumblr on Aug. 13 titled “My Sister Paid Progressive Insurance to Defend Her Killer in Court,” which went viral and began a firestorm of negative comments about the insurance company. Since the post, Progressive has had to offer a rebuttal, the scandal has inspired several popular memes, and the discussion has exploded on social media sites — eventually ending in Progressive feeling the heat and settling with the Fisher family.
In 2010, Matt Fisher’s sister, Katie, was killed in an auto accident by a driver who, according to every witness report, ran a red light. Katie’s killer was underinsured, but Katie held a Progressive policy that was meant to cover expenses if another driver in an accident was underinsured.
However, despite the policy agreement, Progressive declined to pay Katie’s family, and because of a Maryland law that prevents lawsuits against insurance companies when they refuse to pay under the policy for a breach of contract, the only way for Katie’s family to take action was to sue the other driver.
Fisher says his family did not want to take the other driver to court, but a jury ruling in favor of his negligence was the only legal next step in their attempt to pursue Progressive and force it to pay, as per the policy. Fisher says Progressive sent its legal team to defend the driver who killed Katie to save itself from paying the Fisher family.
Discussions about Progressive were 51.33% negative in the week after Matt Fisher’s post.
The defense attempt was unsuccessful, and the jury ruled in favor of the Fisher family — the other driver was determined to be negligent. In its response, the insurance provider claimed that it did not represent Katie’s killer in court. Diligent fact checkers found that the family’s lawyer said the company did not defend the driver but coordinated with the driver’s defense.
Progressive mishandled the situation in a way that will negatively affect the company, most likely for years to come — but its mistakes provide an excellent example of the power of social media publicity as well as what not to do when your business is in the midst of a public relations crisis.
Even with dozens of articles posted about the scandal, Twitter ruled the online conversation, with 99.33% of mentions.
When a crisis like this occurs, it’s important to get it handled, and get it handled quickly — passionate complaints such as Matt Fisher’s can create a huge stir of public outcry. Progressive fought hard to avoid paying the Fisher family the $75,000 they were owed, and that struggle earned the company only negative buzz. To avoid something like this from happening to your business, use social media monitoring tools to frequently track conversations involving your company and handle any situation that comes up before it escalates to the level seen in the Progressive scandal.
In this week’s “Future of Engagement,” Murray Newlands discusses the controversy.
[youtube]http://www.youtube.com/watch?v=E4B98FTfGh0[/embed]