Progressive Insurance over the past two weeks has offered a step-by-step guide on how not to respond to a social media crisis.

It seems that at every step in the crisis, the company’s moves were tantamount to bringing barrels of gasoline to an already raging fire. And now at the end of the second week, Progressive’s reputation is taking a big hit.

The crisis for the ubiquitous insurance company featuring big-haired Flo began last week when comedian and writer Matt Fisher wrote a blog post saying that Progressive turned against its client, Fisher’s sister, and defended the driver who killed her in a car accident. Fisher clearly has a way with words, and titled the blog “My Sister Paid Progressive Insurance to Defend Her Killer In Court.”

As Fisher tells it, an underinsured driver killed his sister in a car accident. The driver’s insurance company paid out a small claim to Fisher’s sister, but Progressive balked at covering a good portion of the difference even though she had paid for Progressive’s coverage for underinsured drivers. The issue went to court, and Fisher said Progressive defended the at-fault driver even though its client was Fisher’s sister. The reason, presumably, was to avoid paying out a large claim.

The court sided with Fisher’s family and Progressive is now faced with having to pay the entire claim, in addition to defending its role. Fisher’s post went viral, prompting social media users to flood Progressive’s Facebook page and Twitter feed with negative comments.

To be fair, Progressive had its hands full from the start, and even the most tactical response plan may not have been helpful in quelling the flames of this crisis. But its actions made things worse. Here’s how Progressive blundered in its response:

Progressive waited too long to address the issue. Online crisis’ can go viral from those without a large following or any social media savvy. Clearly, Fisher knows social media, and he effectively leveraged his loud audience to get behind the issue. In this case, the wait and see approach should not have been an option. A prompt, effective response could have helped, even if did not confirm or deny the claims.

It issued an ineffective spam-like response strategy. When the insurer finally responded to the claims, it was a blanket approach, cut and pasted to hundreds of posts about the issue. The Twitter responses came with a mug of Progressive spokesmodel Flo, complete with a big smile and ruby red lipstick. This spam approach reeked of desperation, and the smiling Flo just added insult to injury. Later posts removed the Flo mug.

Its response statement was reliant on legalese. Progressive’s response carried a fair amount of compassion, but the phase “we properly handled the claim within our contractual obligations” likely came straight from the legal team and not so subtly gave reasoning for its actions in the case.

Its further response was not borne out with the facts. In a further clarifying response after Fisher posted another blog with the name of the Progressive attorney at the trial, Progressive made it clear that it did not defend the driver in the case. Strong response, but unfortunately for the insurer, online sleuths pulled the court records and apparently found a document confirming that Progressive did have an attorney working with the defendant’s insurer. If Progressive did represent the other side, then the company has an obligation to come clean or to at least not say it didn’t.

Late Thursday, Progressive seemed to be getting its footing on the issue, posting a longer response on its blog. They admitted to working with the driver’s insurance company, and said it was required as part of Maryland law. The focus of the post, however, attempts to bring closure to the issue by reporting that Progressive had reached an agreement with the Fisher family to settle the claim.

Based on the dozens of comments on the blog post so far, the issue is far from over. One commenter “Former Progressive Customer” said that hiding behind legal technicalities “is the worst kind of PR nonsense.”

Gil Rudawsky is a former reporter and editor. He heads up the crisis communication and issues management practice at GroundFloor Media in Denver. Read his blog or contact him at grudawsky@groundfloormedia.com.

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