Thursday, September 18, 2014

Washington businesses refunded more than $1 million in overcharged commercial insurance rates

This month, Zurich North America insurance group completed reimbursing Washington businesses $1.02 million and more than $123,000 in interest on 568 commercial auto policies that had been overcharged.

In October 2013, the OIC took action against a handful of Zurich North America’s companies for overcharging Washington businesses for commercial auto insurance policies. The companies are American Zurich Insurance Co., American Guarantee & Liability Insurance Co., Colonial American Casualty & Surety Co., Fidelity & Deposit Co. of Maryland, Zurich American Insurance Co. of Illinois, and Zurich American Insurance Co. 

The companies agreed in a consent order to pay a $50,000 fine and to refund policyholders, including 8 percent interest, who overpaid based on the incorrect rates.

This month, we closed out the case when Zurich North America reported it had completed the terms of the agreement. The overcharges happened because the companies failed to notify the OIC that they were going to continue to use their old rates, rather than charging new rates filed on their behalf by an insurance rating organization they belonged to. 

Tuesday, September 16, 2014

OIC orders unlicensed golf tournament insurer to stop doing business in Washington

Yesterday, the OIC ordered L & B Enterprises Inc., also called Tournament Pros, to immediately stop selling insurance in Washington state. Tournament Pros, based out of Maryland, has sold at least 18 insurance contracts for golf tournaments in our state since 2012 without being authorized to do so.

Golf tournaments often buy insurance to pay hole-in-one prizes or prizes for chipping or putting contests. These tournaments are popular fundraisers, as players pay an entry fee and fees to participate in contests.  

The OIC received a complaint after a May 2013 armed forces golf tournament at Bremerton's Cascade Course at Gold Mountain. The tournament organizer purchased a contract for a $10,000 hole-in-one prize on the 185-yard third hole, but a golf course employee mistakenly hung the prize sign on the 14th hole. According to the tournament sponsors, a sailor who had flown in from another state to participate in the tournament got a hole-in-one on hole 14, which was longer at 228 yards from the tips and more difficult. The tournament sponsor reported that it asked Tournament Pros to pay the prize; the company declined but offered to give the golfer $500. The tournament sponsor then complained to the OIC, and our legal team found out the insurer is not authorized to sell insurance in Washington. 

Tournament Pros has 90 days to request a hearing to contest the order. It also can choose to become an authorized insurance producer in Washington, at which point it would be allowed to continue to do business here.

In February 2014, a hole-in-one insurer who had been illegally doing business in Washington and had defrauded several charity golf tournaments and golfers was sentenced in King County Superior Court to $15,000 in restitution to his victims. Kevin Kolenda of Connecticut had been defrauding people in a handful of states for more than two decades and was extradited to Washington to face the charges.

Thursday, September 11, 2014

OIC is looking for health care network, consumer advocacy professionals

OIC opened two new jobs this week, both working in our Tumwater headquarters.

The first job will help us ensure that health insurance plans have adequate networks of medical providers across the state. The position is a Functional Program Analyst 3 in our Rates and Forms Division. The person in this position will review network access reports and provider agreements that health insurance companies submit to us. The position reports to our Healthcare Consumer Access Manager and plays a crucial role in our state's implementation of the Affordable Care Act.

The position is open until filled. Read more about the position or apply at careers.wa.gov.

The second job is an Office Support Supervisor 2 in our Consumer Protection Division. We have a robust consumer protection program, working directly with Washington consumers and insurance companies. This position will supervise our consumer hotline staff, oversee consumer hotline operations, serve as the public records coordinator for the division and report on the division's performance.

This opening closes on Sept. 25. Read more about the position or apply at careers.wa.gov.

Wednesday, September 10, 2014

Can my age be used as a rating factor in auto insurance?

While it may sound like age discrimination, the answer to this question is "yes." A person’s age can be and usually is used as a factor in determining auto insurance rates. Age is connected to risk and is linked to accident frequency, accident severity, and claim costs, so insurers are allowed to factor it into rates. 

There are other rating factors typically used by insurers, which you may review on our website.         

If you find yourself experiencing a little sticker shock when you see your auto insurance premium, it’s always a good idea to shop for competitive auto rates every now and then. We recommend people do that in order to determine if they can find lower rates for the same coverage. Young drivers can sometimes get discounts for good grades and senior drivers can sometimes get discounts for taking driving classes for people aged 55 or older. Ask your agent or insurer about possible discounts.

Questions? You can contact our consumer advocates online or at 1-800-562-6900.

Monday, September 8, 2014

Seattle Children’s Hospital officially withdraws legal complaint

Seattle Children’s Hospital officially withdrew its legal challenge with the OIC on Sept. 5 after it reached an agreement with Regence Blue Shield to include some services in Regence’s health provider networks for 2014 plans.

Seattle Children’s Hospital initiated legal proceedings about a year ago when Premera, Regence Blue Shield and Coordinated Care decided against including the hospital and research facility in their medical networks because of cost concerns. Seattle Children’s argued the OIC shouldn’t have approved 2014 plans from the three carriers because they excluded the facility from their networks for routine pediatric medical care. The plans argued Seattle Children’s charges for routine pediatric medical care would drive up their costs; Insurance Commissioner Mike Kreidler sided with the plans in favor of “narrow networks” to be able to provide cost-effective services for consumers. No families who needed specialty pediatric care were turned away from Seattle Children’s or had to pay out of pocket for those services.

Seattle Children’s and Premera Blue Cross last month reached an agreement to include the hospital in its medical networks, effective Sept. 1. Coordinated Care earlier this year made a deal to include the hospital in its network and was removed from the case.  

OIC is in the process of reviewing 2015 plans that are sold outside of the Washington health benefit exchange. At the end of August, OIC approved 90 health plans for sale inside the Exchange, called Washington Healthplanfinder, with a record low 1.9 percent average rate change.

Friday, September 5, 2014

Pierce County woman ordered to repay insurance company for fraudulent car claim

A Pierce County woman was sentenced to 60 days of electronic home monitoring and ordered to repay $17,426 to Travelers Insurance for attempting to collect insurance money for a car she claimed was stolen and destroyed in a fire. Donica Santos, 40, pleaded guilty to one count of first-degree theft and one count of insurance fraud in Pierce County Superior Court last month.

In March 2012, a driver reported Santos’ vehicle was on fire on the side of Reservation Road in north Thurston County at about 1:40 a.m. on March 16, 2012. Santos reported to Travelers’ Insurance Co. later that day that her car had been stolen from her Tacoma home and was a total loss. Santos told investigators that she had last seen her vehicle the previous night and had not left her house or used her cell phone between 10:30 p.m. and 2:50 a.m., when police arrived at her house to investigate.

However, Santos’ cell phone records showed she used her phone repeatedly late the evening of March 15 and the early morning hours of March 16; several of the calls were made in Thurston County, near where her 2006 Chrysler 300C was found on fire. 

Travelers denied the claim, but was required by state law pay off the car loan balance of $17,426.

Santos was charged in December 2013 after she was investigated by Insurance Commissioner Mike Kreidler’s Special Investigations Unit.

Thursday, August 28, 2014

90 health plans approved for next year's Exchange - find one in your area

Health plans and their rates for next year's Exchange, Washington Healthplanfinder were approved by our office and certified by the Exchange board this week.

Consumers shopping inside the Exchange will have 10 companies and 90 plans to choose from, depending on where they live. Not all plans are available in every county, but most people will have more choices and minimal rate changes.

Additional insurers and plans for sale outside of the Exchange are still under review. There may be more plans for sale outside of the Exchange, but premium subsidies are not available.

Open enrollment for inside and outside of the Exchange starts Nov. 15 and runs through Feb. 15, 2015.

Check out the map below to see the 2015 plans and rates available in your county.


Map of Washington

ACA’s 80/20 rule saves consumers money

Created through the Affordable Care Act law, the 80/20 rule, also known as the Medical Loss Ratio (MLR) rule, requires health insurers to spend at least 80 percent of premium money on patient care and quality improvement activities or pay a rebate back to consumers.
This month, the U.S. Department of Health and Human Services reported that since the rule took effect, more insurers year over year are meeting the 80/20 standard by spending more of the premium dollars they collect on patient care and quality, and not red tape and bonuses. If an insurer did not spend enough premium dollars on patient care and quality improvement, they must pay refunds to consumers in one of the following ways:
  • A refund check in the mail.
  • A lump-sum reimbursement to the same account that was used to pay the premium.
  • A reduction in future premiums.
If the consumer bought insurance through their employer, their employer must provide one of the above options, or apply the refund in another manner that benefits its employees, such as more generous benefits.
In 2013, 9,605 Washington consumers received refunds totaling $792,846, an average of $122 per family.
Read more about health care reform on our website. Questions? Contact our consumer advocates online or at 1-800-562-6900.

Wednesday, August 27, 2014

Temporary special enrollment for those stuck in Exchange plans begins today



A temporary special enrollment period begins today for those consumers who have experienced difficulties with enrollment in health plans on the Washington Healthplanfinder. 
Insurance Commissioner Mike Kreidler authorized the special enrollment period this week as another option to those who feel they might need more help. This voluntary special enrollment period starts Aug. 27 and runs through Nov. 14, 2014. Only people who attest to having enrollment, billing, or payment issues with an Exchange plan may change plans during this time.
If you’re considering this option, you should be aware of all of the details involved, including the fact that you could lose a current premium subsidy. Special enrollment may not be the best choice for everyone. But as the commissioner notes, “Hopefully, it will bring relief to some.”

Tuesday, August 26, 2014

Talk to your agent or broker about coverage for college students



Many college students are heading back to college or starting their college careers this time of year. In addition to outfitting students with laptops and dorm room supplies, parents may want to think about whether their students are covered by the right insurance policies. 

Insuring possessions
For students who live in a dorm, typically the parents’ homeowner policy will cover the student’s personal belongings while they are away. The same is true for college students who live at home. Some policies may have a dollar limit for off-premises personal property, so check with your agent or broker to find out what your policy covers.
If the student is renting an apartment or house, it’s worth looking into renter’s insurance. If you have a roommate, read our blog post from earlier this month: Living with someone? You may need your own policy to protect your belongings.

Auto insurance
Auto insurance policies typically don’t change once a driver goes to college, but it can’t hurt to check with your agent or broker if the car will be driven in another state for an extended period of time or, conversely, if the car will stay home while the student is in school and isn’t likely to be driven. You can also ask about any discounts they may have available for good grades or good driving records.

Health insurance
Under the Affordable Care Act, parents can keep children on their health insurance policies until age 26. Read more about health care reform for families.