Phony insurance scams – have you been duped? How can you protect yourself?
From Victoria Knight in the August 12 Wall Street Journal:
The most prevalent way to sell phony insurance continues to be through real or bogus associations. Between 2000 and 2002, 144 such scams left more than 200,000 policyholders with more than $252 million in medical bills, according to a 2004 report by Congressional investigators. Illegal health plans flourish especially during periods of high premium increases. On Thursday the National Association of Insurance Commissioners issued an alert to consumers warning them about such fraudsters.
What can you do to protect yourself if you’re looking at association health plans? The article offers the following advice:
- Associations that provide a wide variety of member services, such as credentialing, rather than just health insurance, and which have stricter entry requirements, tend to offer the better plans.
- Call your state’s insurance department to find out if the insurer that underwrites the association’s plan is licensed in the state where you live, is financially sound and has a good track record of paying claims.
- If you’re buying a policy from a national association, find out if your state regulator is authorized to intervene if you have problems. If the association is headquartered in another state, for instance, your state’s regulator’s hands may be tied and the other state’s regulator may not be able to help either because you’re not a resident.
- Don’t just look at the premiums. A low monthly price may be attractive but to find out the real value of the plan, look at the deductible, co-insurance and benefits. If you have a past or existing condition, is it covered? And if you do get sick, will you be able to renew the policy, and, if so, at what cost? (healthinsuranceinfo.net’s Evaluating Health Insurance Choices Worksheet FREE two-page worksheet will help you compare health insurance costs and coverage (
PDF format, two pages, 135 KB).) - Look for a well-established plan with a history of reasonable renewal rates.
- Explore all your options, including policies insurers sell directly to individuals or small business owners, as they may offer more comprehensive coverage for less.
Read the original article at the Wall Street Journal’s website: More Turn to Professional Groups for Insurance