The impact of COVID-19 has consumed our daily lives and has touched almost every industry in the United States. The Life and Health Insurance industry is being impacted in a number of ways. President Trump recently announced that health insurance carriers, CIGNA and Humana, are waiving deductibles and copays for the treatment of and testing for COVID-19. Certainly claim departments at Life, Health and Disability insurers have seen an uptick in claims regarding people suffering from the impact of the Pandemic. They are on the front lines providing important insurance benefits to customers during a time of great anxiety. Within the last few weeks Insurance Regulators have issued a variety of directives and moratoriums on how existing policyholders should be treated during the impact of COVID-19. For example, in Massachusetts the Department of Consumer Affairs and Business Regulation issued Bulletin 2020-05 directing insurers as follows:
All insurance carriers are to provide employers and individuals with as much flexibility as is reasonably possible to maintain their existing coverage during the period of the COVID-19 public health emergency. Carriers should:
- Explore ways to streamline or delay the submission of administrative paperwork that may jeopardize the maintenance or issuance of coverage.
- Explain grace periods that usually allow distressed policyholders experiencing financial hardship to delay payments without coverage termination.
- On a case-by-case basis, work with employers or individuals experiencing financial hardship to find the best ways to address concerns with the timing of premium payments in order to delay any cancellation of coverage for non-payment and collection activity.
- Explore all possible ways to: relax due dates for premium payments, extend grace periods, waive late fees, non-sufficient funds fees, installment fees and penalties, allow payment plans for premiums, assist affected policyholders to find ways that insurance policies do not lapse, and consider cancellation or non-renewal of policies only after exhausting other efforts to work with policyholders to continue coverage.
Other states, like New York, have even more comprehensive guidance as outlined in a series of Bulletins that have been issued throughout the month of March.
for a link that was created by the National Association of Insurance Commissioners ("NAIC") that provides a state by state listing regarding announcements related to the COVID-19 pandemic. If we can be of any help during these uncertain times please reach out to a member of our team. Stay healthy.