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Tuesday, July 3, 2012
OKLAHOMA CITY – Nearly four years after levying a $20 million fine against HealthMarkets, Inc., a multistate evaluation of the company has shown a drastic turnaround.
“HealthMarkets, Inc. has made substantial improvements,” said Oklahoma Insurance Commissioner John D. Doak. “They took our concerns seriously, implemented several new programs and changed the company culture. That’s a big win for consumers.”
In July 2008, state insurance regulators and the National Association of Insurance Commissioners (NAIC), announced the details of a $20 million settlement agreement between 48 states, 5 jurisdictions and The MEGA Life and Health Insurance Company, Mid-West National Life Insurance Company of Tennessee and The Chesapeake Life Insurance Company, which are all affiliated companies of HealthMarkets, Inc. It was the result of a multi-year investigation that found serious violations involving consumer disclosure, oversight and training of agents, claims handling and complaint-handling practices.
Insurance regulators from Oklahoma, Texas, California, Alaska and Washington participated in the company’s follow-up market conduct exam and found dramatic improvements.
“This is a case where we came in to monitor this company and set some benchmarks,” said Doak. “HealthMarkets, Inc. paid attention, implemented new controls and addressed virtually every problem identified in the original examination. This turnaround is a regulatory success.”
The dedication to compliance led to only a few minor infractions being found in the follow-up examination. As a result, the companies paid a fine of $325,000. Oklahoma will receive $5,320, which will go into the Oklahoma Insurance Department’s Anti-Fraud fund.
ABOUT THE OKLAHOMA INSURANCE DEPARTMENT
The Oklahoma Insurance Department, an agency of the State of Oklahoma, is responsible for the education and protection of the insurance-buying public and for oversight of the insurance industry in the state.