"This order is tantamount to telling a thief to return stolen money -- but imposing no punishment," Richard Blumenthal said of acting Insurance Commissioner Susan Cogswell's agreement with Milwaukee's Assurant Health. "Cheating consumers out of promised coverage for catastrophic illnesses deserves strong penalties and consequences."
The agreement, in which Assurant admits no wrongdoing, follows a six-month Insurance Department investigation of claim denials on health policies that last six months or less, The Hartford (Conn.) Courant reported.
Assurant is alleged to have wrongly said customers failed to disclose existing medical problems when applying for policies.
The agreement calls for Assurant to submit a plan for corrective action. It also says the department will choose an outside firm to determine the full extent of wrongly denied claims and what restitution the insurer should pay.
Assurant will pay for the audit.
Cogswell said her first priority was to get restitution and she did not want to set a fine "until I can see how serious (the problem) is."