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Bogus Health Insurance Sold in Utah

Bogus Health Insurance Sold in Utah

Posted - Jul. 29, 2004 at 7:23 a.m.



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SALT LAKE CITY (AP) -- Fake health insurance policies are being sold to Utah residents, the Utah Department of Insurance said.

Some victims have discovered their policies were worthless only after making a claim.

"It depends on the individual and what type of health problems they have, but anyone who buys a worthless policy could be out a lot of money if they have to make a claim," Jilene Whitby, insurance department spokeswoman, said Wednesday. "One operation, for example, could cost in the tens or hundreds of thousands of dollars."

Many consumers obtain health-insurance coverage through an employer and are at little risk for ending up with a fake policy.

But other consumers, who lack coverage at work or are trying to find less expensive alternatives, purchase health-insurance coverage on their own from outside companies, and are at greater risk.

Whitby said her department recently received three dozen calls from consumers who had purchased or were contemplating buying health insurance policies from unlicensed companies or agents advertising policies through faxes or e-mails.

She is not sure how many people in Utah have been victimized by scam artists posing as insurance agents or how much they paid out in premiums.

Nationally, the General Accounting Office said that between 2000 and 2002 alone, 144 fake health insurers sold fake policies to more than 200,000 people, who faced $252 million in unpaid claims.

(Copyright 2004 by The Associated Press. All Rights Reserved.)

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