Customers are protected even when insurance failed
Have you ever worried about what happens if your health insurance company goes bankrupt? In today's health care market, health insurance companies face tremendous risks predicting costs, setting premiums and managing claims within the expectations. Occasionally things do go wrong and claims exceed the premiums collected.
It is great to see this news story about how things can go better than expected even in a financial crisis. When Benicorp Insurance Company ran into financial difficulty, all 3200 of its small business customers in multiple states were offered continued insurance and United Healthcare, the parent company of Golden Rule Insurance offered guaranteed acceptance to all of the businesses regardless of prior health conditions at the current ratings. (Substandard health groups did not get the lowest insurance ratings but did benefit from the tiered rating mandated in most states).
We buy insurance for its guarantees it offers. When things go wrong we expect the government to step in but almost none of us really understand the capacity and responsibility of re-insurance funds. The best real assurance we have is a track record that the safety net system has worked well so far.
In this case, it goes one step further; the customers wound up with a better insurance company than their original. It is worth noting that United Healthcare is really on a PR roll lately. The company has scored with great reviews, low recent NAIC complaint ratios, and all three of its commercial health insurance companies are gaining ground both in terms of market share and consumer image. Golden Rule Insurance has made dramatic turn-around from on of the questionable carriers a decade ago to the most innovative and trusted throughout most of the nation today. Oxford has been a steady suppliers in its regional markets and Pacificare is now the most competitive insurer to have in California.
This story also underscores the importance of using a legally filed insurance plan. If the company were not legally filed, then these policyholders would not have been so lucky.health insurance, golden rule, benicorp