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Monday, June 18, 2007

Insurance Companies Cancel Policies Retroactively

Ever heard of rescission? Insurance companies certainly have. Those who can only buy insurance themselves, not through a group policy, are going to be dealing with that term if they try to use the policy. One lady did that. She is a young person in her twenties who has never been sick in her life. She believed that the policy she bought as a student would take care of anything she needed it for. After all, she had never been sick before.

Recently, she found out that she has a rare optical disorder that, if not taken care of through surgery, she will go blind. She has already lost part of her vision. She sent in a claim so that the surgery could happen. What came from the insurance company was a series of letters detailing her account being investigated for fraud. They were threatening rescission, which is actually a retro-canceling of her policy so that they do not have to pay out anything.

ABC news got involved when they heard about her. They contacted the company involved, Blue Cross of California. They said that they were not intending to cancel her and that they had sent out only one letter that told her they might investigate. This, of course, is not true. Since then, the company has stated to ABC news that they stopped the investigation and are going ahead with paying for her surgery. At the time of the story, the lady in question had no contact from the company saying this.

Isn't it time that the insurance companies wake up to the fact that the public are their bread and butter and if the public chooses not to have a policy with them, they will go down like so many other companies have in the past? I can't be the only one who remembers how insurance companies dropped the ball during the Katrina crisis and are still doing so as long as they do not pay out on policies owned by people with needs from that storm. WAKE UP, AMERICA!!! This is a shame we cannot ignore.