Iowa Warns Agents Against Fraudulent Health Plans

Such plans often use insurance agents to market the coverage, the division says. Initially, claims are paid, but only for a short period of time, the division says.

The consumer is left with responsibility for payment of claims, and the agent can lose her license and face criminal prosecution, the division says.

Legitimate employee retirement act plans and union plans can be exempt from state insurance regulation, the division says. People selling fraudulent health plans try to fool agents and consumers by claiming their plan is exempt as well. However, legitimate plans of this nature are established by unions for their own members or by an employer for her own employees. In most cases, insurance agents do not sell them, the division says.