What Color is Your Parachute?

Think you have coverage? Maybe not. At least not with a major carrier here in Georgia.

This carrier known for their “color” was purchased a few years ago by a California holding company. Last year the California company merged with another holding company based in Indiana.

The Indiana parent decided clients would be better served if accounting functions were handled in California instead of Georgia.

Premiums (and commissions) were still calculated here in Georgia, but disbursements are now handled in California.

The result has been disconcerting to some individual policy holders and small groups. Some clients, don’t know how many, are just now receiving notices their coverage lapsed as far back as November 2005 for failure to pay the premium. This means some people have not had coverage for 3 months or longer because their premium was not received and properly credited on a timely basis.

Sometimes the policyholder found out when they tried to get a prescription filled. Other times they did not know until they were notified by mail of the retroactive cancellation.

In some cases (I am certain) claims have been paid that will now have to be reversed . . . at least until the coverage is reinstated. Of course if reinstatement is allowed some may have to pay up to 5 months premiums to bring the case current.

This cannot be good.