I got a notice from the home insurance company that covers a rental home my wife and I own. They said that they were canceling the policy because we now had a swimming pool on the property. I called and told them no renter had asked me to pay to put a pool at the house and what were they talking about? They hummed and hawed and sort of, kind of admitted perhaps their agent had checked the wrong home. They will check again they said. I couldn't even blame the government for this stupidity, this is a private insurance company hard at work showing us how well the private sector operates. Here's another, more grievous example from the Huffington Post. Remember: I don't for one minute believe that that Big Pharma is spending a million and a half dollars a day lobbying Congress against the public option because it is in the best interests of We The People. Nor should you. Of course one has to wonder what tort reform will do in cases like these. Texas has reformed tort laws to no visible effect on the cost of medical insurance.
.The South Carolina Supreme Court has ordered an insurance company to pay $10 million for wrongly revoking the insurance policy of a 17-year-old college student after he tested positive for HIV. The court called the 2002 decision by the insurance company "reprehensible."
That appears to be the most an insurance company has ever been ordered to pay in a case involving the practice known as rescission, in which insurance companies retroactively cancel coverage for policyholders based on alleged misstatements - sometimes right after diagnoses of life-threatening diseases.
The ruling emerges from a conservative Southern state with one of the most pro-business climates in the country. And it comes as progressive Democrats on Capitol Hill are pressing for health care reforms, such as a public insurance option, that reflect wariness about the private insurance industry's motives.
The Supreme Court on Monday upheld a lower court's verdict against Fortis Insurance, now known as Assurant. The trial jury had awarded the former college student, Jerome Mitchell, $15 million in punitive damages; the Supreme Court reduced that amount by $5 million.
Mitchell learned that he had HIV when, while heading to college, he donated blood. Fortis then rescinded his coverage, citing what turned out to be an erroneous note from a nurse in his medical records that indicated that he might have been diagnosed prior to his obtaining his insurance policy.
Before the cancellation of the policy, an underwriter working for Fortis wrote to a committee considering whether or not to rescind his policy: "Technically, we do not have the results of the HIV tests. This is the only entry in the medical records regarding HIV status. Is it sufficient?" The underwriter's concerns were ignored and the rescission went forward.
Read more at: http://www.huffingtonpost.com/2009/09/17/insurance-company-must-pa_n_289841.html