Insurance Consumers

Medical Insurance

Questions to ask your agent when purchasing insurance:

• Is the insurance representative you are dealing with a "captive" agent (who represents only one company) or an "independent" agent (who represents many companies)?
  
  
• What are all the coverage options available (e.g. A "Deluxe" versus a "Premiere" policy. If so what's the difference between them?
  
  
• What specific medical conditions (heart disease, stroke, different types of cancer, HIV, kidney disease. mental illness, conditions caused by an accident, covered and not covered? Are there restrictions on any types of treatments, such as bone marrow transplants, dialysis, drug therapies, rehabilitation facilities, chiropractic treatments, marital or family counseling, psychoanalysis, etc.
  
  
• What are all of the applicable deductibles and limits? If something is covered but there's a large annual deductible you must first pay, plus a cap on the amount the insurer will pay per treatment, plus a maximum number of treatments allowed per year, the purported coverage may be - well - illusory.
  If you become ill can your policy be non-renewed, the coverage modified or your premiums increased?
  Would you be considered to be obtaining your policy at work? If so, is the policy governed by ERISA (The Employment Retirement Income Security Act)? If it is, you will probably lose all of the unfair or fraudulent insurer claims protections you have under the laws of your state. This is because of what is called "ERISA Preemption. It substitutes Federal laws for state laws in ERISA governed claims. The problem is that there are NO federal protections against unfair claims handling because the federal government is prohibited from regulating insurance. Therefore, you wind up with no protections under state laws, no protections under federal laws. You're basically left up the creek. With no paddle and a leaky boat. You should try to avoid buying an ERISA Preempted policy at all costs.
  
• Is there any kind of binding arbitration provision in the policy that governs the resolution of disputes? If so, how is the arbitrator selected and how do you know he or she is not going to be biased in favor of the Company? Also, who pays what percentage of the arbitration fee? (N.B. Arbitration clauses almost always heavily favor the insurance company and should be avoided.)
  
  
• Do you have your choice of doctors? hospitals, treatment facilities?
  
  
• Can you see a specialist without first obtaining approval from the insurer?
  
  
• What are the limits on prescription drug treatment? who pays what? Is there an annual cap?
  
  
• Are there any brochures, coverage statements, written examples of the policy you are considering or other materials available for you to take a look at? If so save them in your insurance file.
  
  
• What is the Company's claims handling track record with insurance regulators? Has it recently been fined, subjected to administrative actions or ordered to modify its practices? If so, what are the details?
  
  
• You should be suspect of any agent who says he "doesn't know" the answer to this. This is public information and any agent who has your interests at heart would know this.
  
  
• Have there been any recent, significant, media reports or investigations, judicial actions or jury verdicts against the company involving allegations of fraud, misrepresentation or bad faith practices? If so, what are the details?
  
  
• How do the answers to the above questions involving the company under consideration compare to other companies? If the agent you are dealing with sells only one company's insurance, check in with an independent agent for the comparisons.