What Do I Do If My Health Insurance Company Drops Me?

If you have been current on all your premium payments and made no misrepresentation or material omission on your health insurance application, you have every right to expect a privately-owned medical insurance company will honor your legitimate claims for covered health care expenses. However, disputes do arise when insurance companies revoke coverage after someone has a claim, if premium payments are delinquent, or when policies are rescinded -- often because the insurance company believes the customer has not disclosed all relevant risk factors.

Reinstate the Policy

• If your coverage was dropped because of late premium payments, you may be able to reinstate the polcy by paying back premiums. Each state has different requirements for reinstating an insurance policy. Typically, however, if you act within 30 to 60 days of the receiving the notice of cancellation of coverage, you will be able to reinstate your coverage with very little underwriting.

Appeal the Decision

• Your policy documents should contain information about your company's internal procedures for disputing or appealing a coverage decision. Be prepared to state your case, in writing, making specific reference to the language in your health insurance policy.

Contact Your Insurance Commissioner

• The insurance industry is regulated at the state level, rather than at the federal level. If you could not satisfactorily resolve your dispute dealing with your carrier, you may get more results contacting your state's insurance commissioner or Department of Insurance Regulation. These individuals and agencies have significant enforcement powers, including levying fines for improper or illegal behavior, and even banning companies from selling insurance within their jurisdictions.

Shop Around

• If you are in good health, you may be able to find an even better policy by shopping around and filling out applications with different carriers. A good health insurance broker -- one who represents a number of companies -- can help shop your application around to several carriers and help get you the best value. If you are not in good health, though, your options are more limited.

File a Lawsuit

• You may have been a victim of improper recision, or of post-claims underwriting. Both practices are prohibited in most jurisdictions. You may wish to speak with an attorney with experience and a track record of success in "bad faith" insurance disputes. However, litigation is expensive, and juries have a way of surprising plaintiffs with verdicts.