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Claims Handling
New York, NY: (May-07-08) The Pennsylvania Department of Insurance brought charges against Carmel, IN, based Conseco Inc., alleging that the insurance holding company's long-term care insurance business engaged in trade practices that could prove harmful to consumers. The agency filed suit said that pending claims weren't handled in a timely manner, claim files weren't properly documented or maintained and time frames for company responses to claimants didn't adhere to regulations. The suit was filed after investigations revealed the company's misconduct.
As part of a settlement reached in the case, the agency levied a $2.3 million fine and said that the company is responsible for paying up to an additional $30 million in claims restitution and processing system upgrades. As per the stipulations in the agreement, Conseco Inc. must pay, in addition to the fine, at least $4 million in restitution and administrative costs to harmed policyholders, and invest $26 million in system upgrades and improved claims administration. The deal is said to effect 40 states.
Additionally, the company would face an additional $10 million in fines if it fails to meet the process improvement benchmarks over the next 2 1/2 years. Agency officials said that the deal involves Conseco's Senior Health Insurance Co. and Bankers Life and Casualty Insurance Co. units and covers claims filed from Jan. 1, 2005, through Apr. 30, 2007. [CNN MONEY: CONSECO FINED $2.3M AFTER CLAIMS-HANDLING INVESTIGATION]
Published on May-9-08
As part of a settlement reached in the case, the agency levied a $2.3 million fine and said that the company is responsible for paying up to an additional $30 million in claims restitution and processing system upgrades. As per the stipulations in the agreement, Conseco Inc. must pay, in addition to the fine, at least $4 million in restitution and administrative costs to harmed policyholders, and invest $26 million in system upgrades and improved claims administration. The deal is said to effect 40 states.
Additionally, the company would face an additional $10 million in fines if it fails to meet the process improvement benchmarks over the next 2 1/2 years. Agency officials said that the deal involves Conseco's Senior Health Insurance Co. and Bankers Life and Casualty Insurance Co. units and covers claims filed from Jan. 1, 2005, through Apr. 30, 2007. [
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