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June 17, 2008 at 12:59 PM
Illinois, Indiana and Iowa insurance regulators are calling for insurers to give consumers affected by the recent flooding more time to make payments and take other required actions.
Illinois Insurance Director Michael McRaith has put out a directive calling for “exceptions for consumers in disaster areas” in Commissioner’s Bulletin 2008-04.
McRaith is ordering that insurers help all consumers affected by the flooding, including those living outside officially declared disaster areas, by putting a moratorium on policy cancellations and nonrenewals issued on or after June 10 until Aug. 18.
Insurers should provide an extension of at least 60 days for all other actions, such as payments of premiums or submissions of claims, and they should consider making other changes, such as offering relief for displaced managed care plan insureds who cannot seek care from their usual providers, McRaith writes in the bulletin.
Insurers should post on their Web sites information about all actions taken to comply with the bulletin requirements, McRaith writes.
Any insurer that will not or cannot comply with the directives must notify Illinois regulators by June 25.
Indiana Insurance Commissioner James Atterholt has imposed a policy cancellation moratorium in Bulletin 163.
The Indiana bulletin applies to Indiana counties declared by the state or by the federal government to be disaster areas.
In addition to suspending policy cancellations for consumers in disaster area counties, insurers must suspend any penalties attached to late payments, Atterholt writes in the bulletin.
“This ‘moratorium’ is not a waiver,” Atterholt writes. “It is only an extension of the grace period in which to pay the premium.”
Insurers can cancel or nonrenew policies for other allowable reasons, Atterholt writes.
“However, the department would request insurance companies take into consideration that persons in the heavily impacted areas may be unable to receive a notice of cancellation or non-renewal due to evacuation or delayed postal service in that area,” Atterholt writes.
The Indiana department will try to do its share to help by giving insurers, producers and other regulated individuals and entities 60 extra days to submit premium tax filings, meet continuing education requirements, and meet other deadlines, Atterholt writes.
