Important information for Central United policy holders

posted on:
May 15, 2008

author:
Wendi Lewis

category:
Fraud

FOR IMMEDIATE RELEASE:

MONTGOMERY, ALA – Consumers who have cancer insurance policies with Central United Life Insurance Company have until June 3, 2008, to review the details of a class action lawsuit against the company and opt out if they wish to exclude themselves from the class.

The Central United cancer policies provide for reimbursement of “actual charges” on claims for chemotherapy / radiation benefits. However, it appears that contrary to the terms of the policy, Central United has been paying only a portion of the charges, based on what the physician was paid by medical insurance or Medicare. Policyholders may have received only 30-40 percent of what they were owed.

A class action notice known as Skelton v. Central United Life Insurance Company was mailed to policyholders who possessed a policy during the timeframe of February 2003 through April 2008. Policyholders must opt out of this class action if they wish to pursue an individual claim.

This class action would settle for all policyholders any dispute over claims for benefits. This settlement would affect any current claims, and also any future claims or disputes.

It is recommended that policyholders contact an attorney for legal advice immediately to determine if they should opt out. If policyholders do not opt out by the June 3 deadline, they will not be able to pursue individual litigation if they feel the class action decision is not an adequate remedy or if they file a claim on the policy in the future.

“These policyholders paid for a policy that would provide them with cash benefits at a time when they most needed it, during cancer treatments, and this company is cheating them on those benefits by trying to pay less than the insurance policy provides,” said W. Dee Miles, who heads the Consumer Fraud department at Beasley, Allen, Crow, Methvin, Portis & Miles, P.C. “That’s a fraud on consumers and the class action relief does not remedy that fraud. We recommend some consumers should opt out.”

In a recent review of Central United’s Life and Annuities products by the Texas Department of Insurance, the company’s complaint index jumped from 0 to 34.9270 between Dec. 31, 2006 and Dec. 31, 2007. According to the report, the average index is 1.00. A number less than 1 indicates fewer complaints than average; a number greater than 1 indicates more complaints than average. For the most recent completed year, a given insurer’s index may change over time, as policy count data is received by TDI. This will affect each insurer’s percentage of the total.

Beasley Allen is currently pursuing individual claims of those who wish to opt out of this class and is accepting cases for those who wish to opt out of this class and pursue litigation of their own. In addition to the Central United cases, Beasley Allen also is currently reviewing all cancer policy claims concerning the “actual charges” issue.

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