Be Wary When Your Insurance Agent Says ‘Everything Will Be Covered’

Many Americans without health care insurance are turning to private insurance companies for coverage. These companies know they have a captive audience and often tell consumers anything they want to hear – such as ‘don’t worry, everything will be covered’.

Everything is generally NOT covered

Even though some insurance sales representatives make outlandish promises, most policyholders don’t realize that everything is not covered until it’s too late. Mega Life Insurance Company has been accused of just that. Their sales agents have been accused of aggressive sales tactics and misleading consumers on what their policies actually cover. In case after case, consumers have complained that claims for even the most basic of services, such as doctor visits, lab tests and prescriptions have been denied by the company – even though sales representatives told them otherwise. Mega, and its sister company, Mid-West National, do business with their parent company, HealthMarkets.

States getting involved

Consumers have been complaining about Mega’s sales practices and false promises for years. So many complaints have been filed that many state’s Attorney Generals are getting involved. Since 2002, Mega has been fined by seven states and is being investigated by 36 other states who are working together to find out more. While the results of the multi-state investigation won’t be known for some time, some states, such as Massachusetts, are not waiting. The Massachusetts Attorney General recently filed a lawsuit against the company alleging deception and unfair practices.

Premiums AND association fees?

Legislators who are involved in the matter complain that companies like Mega require policyholders not only to pay insurance premiums, but also to join an association to get the insurance. This practice is very unusual and also very expensive -- $100 to join and another $40 per month to maintain a membership.

Consumers have limited choices

Many consumers have reported feeling as if they have limited choices as they can’t afford traditional health insurance, but need some type of coverage. Unfortunately, many end up settling for the types of plans that promise everything, yet provide nothing. Regardless of the type of insurance a consumer purchases, their insurance company should be up front about how much the insurance costs and explain exactly what the policy covers. If you’ve suffered a financial or medical loss due to an insurance company’s false promises, contact an attorney who understands how insurers operate. To contact an attorney near you, click here.

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