Q: What is behind AFLAC's rising consumer complaints?
A: According to The National Association of Insurance Commissioners (NAIC), the number of group health insurance consumer complaints has risen sharply in recent years. In 2005, the "Complaint Ratio Score" was 11.66, or eleven times higher than the norm for all insurance companies compared to the amount of premium written. A Complaint Ratio Score of 1.0 is the median for all insurance companies that issue group health insurance. Anything lower indicates favorable complaint history and anything higher than 1.0 indicates an comparatively unfavorable track record. This in itself would be cause for concern. But then the complaint Ratio Score jumped to a shocking 64.2 in 2006 and then to 94.5 in 2007. That means that the number of premium adjusted complaints increased by nine-fold over only a three year period. The NAIC provides little insight into the complaints, except to indicate that the complaint ratio isn't nearly so high for the company's other lines of individual insurance business.
By way of comparison with other similar supplemental insurance products that are available at MedSave.com, the highest Complaint Ratio Score for United States Fire Insurance Company, the issuer of the comparable Core Health Insurance products, was 0.45 in 2007. That means that AFLAC has about 200 more complaints per dollar premium than Core Health. Markel Insurance that issues an individual supplemental insurance called Basic Health Insurance had a Complaint Ratio Score of 0.12 in 2007.
There are plenty of wide-ranging consumer comments posted in various online forums, but these are of limited value since there is no way to know which comments are valid. One writer summed his opinion up by saying "The cancer policy is the only worth while product they offer. Other than that, everything I've found and heard about them is that they're basically a scam. However, most of your dealings with be with your local representative, so your experience will depend a lot on them." This may be the key to understanding the complaint issues. Since AFLAC is sold only by sales representatives, a customer's experience may rely heavily on the performance and response of that individual agent.