January 14, 2010

DIFP returns over $14 million to insurance consumers in 2009

Jefferson City, Mo. - Consumers who filed complaints with the Missouri Department of Insurance received a record $14.4 million from their insurance companies in 2009 - a $2 million increase over 2008. The money was returned as a result of the department's mediation efforts on behalf of consumers who had filed complaints, and that total is the highest ever, according to department records.

The most common reasons for complaints to the department included denial of claims, claims delays, and unsatisfactory offers.  The department recorded the most complaints in the following types of insurance: health, auto and homeowners. Some notable accomplishments from the past three months: 

  • After a fire destroyed their house, a family of four was running into trouble getting their homeowners insurance claim paid. The department got involved, and the insurer has now paid more than $900,000 on this claim.
  • A long-term care insurer attempt to collect an $8,600 from a policyholder who believed she had paid her premiums in full. After receiving her complaint, the department found the company had improperly explained the premiums. The company forgave the bill and stopped the collection attempts.
  • A homeowners insurance company denied a claim to rebuild a destroyed garage, saying the family had not filed the claim on time. The department's investigator found the claim was filed on time, but the insurance agent waited to turn it in to the company. The company agreed to pay the $5,500 claim.

"For our economy to grow, Missourians must be sure that proper consumer safeguards are in place.  That makes consumer protection vital to our economic success," Gov. Jay Nixon said. "By recovering more than a million dollars a month for Missouri policyholders, we are assuring citizens that effective help is available to them as our economy recovers."

For the year, the department fielded more than 4,800 formal complaints and assisted 3,800 consumers in writing and another 27,000 over the telephone. The number of formal complaints is a 20 percent increase over 2008's total.

The top categories of complaints were as follows:

By reason

By line of insurance

Claim denial (1,088 complaints)

Health (1,637)

Claim processing delay (775)

Auto (1,104)

Unsatisfactory settlement offer (672)

Homeowners (625)

Consumers with complaints or questions about their insurance claim or policy provisions can call the Insurance Consumer Hotline at 1-800-726-7390 or file a complaint at insurance.mo.gov.