January 24, 2013

Missouri Department of Insurance returns nearly $11 million to consumers in 2012

Jefferson City, Mo. - Consumers who filed complaints with the Missouri Department of Insurance received nearly $11 million in additional claim payments from their insurance companies in 2012.

"Protecting Missouri consumers is our top priority, and they need to know we are a free resource that can assist when they run into problems with insurance claims," said John M. Huff, director of the Missouri Department of Insurance. "Sometimes all it takes is a call or letter from one of our technical experts to resolve a dispute between policyholders and their insurance companies."

Health insurance generated the most complaints from consumers, followed by auto and homeowners. The most common reasons for complaints were denial of claims, claim delays and unsatisfactory offers.

Some notable accomplishments from the past three months:

  • A northwest Missouri couple contacted the department because their health insurance claims weren't being paid. The couple was told by their insurance company that their policy was a limited benefit plan, even though their agent told them it was a comprehensive major-medical policy when they bought it. The insurance company has agreed to pay out more than $200,000 since the department became involved, far above the coverage limits in the policy.
  • A Franklin County man contacted the department after he was having claim payment issues with his motor vehicle extended service contract provider. The man had been without his vehicle for five months after he took it in for service because the engine was smoking. Once the department became involved, the company agreed to pay $3,000, the maximum amount under the terms of the contract, to have his vehicle repaired.
  • A Boone County man filed a complaint regarding a claim delay on stolen property. When the department became involved, the company resolved the issue and paid nearly $59,000.

In 2012, the department handled 3,851 formal complaints, while answering questions from 9,240 consumers in writing and more than 22,000 over the telephone.

The top categories of complaints were:

By reason

By line of insurance

Denial of claim (891)

Health (1068)

Delay of claim processing (631)

Auto (809)

Unsatisfactory offer (587)

Homeowners (717)

The department's Market Conduct Section returned nearly $2.4 million to consumers, health care providers and the state as a result of exams and investigations in 2012. Enforcement actions against insurance companies resulted in nearly $5.1 million in fines paid.

Market conduct exams and investigations aim determine whether insurance companies are complying with state law in their treatment of customers, including the rates being charged and the way claims are handled. Exams can result in refunds for consumers, fines for companies, changes in business practices and other remedies.

Since 2009, market conduct enforcement actions have generated nearly $13.1 million in payments from insurance companies. The money goes toward refunds for consumers, general revenue and the State School Fund.

Consumers with complaints or questions about insurance claims or policy provisions can call the Insurance Consumer Hotline at 800-726-7390 or file a complaint at insurance.mo.gov.