Summary:
By denying coverage, rescinding policies and basing rates on health, illness and lifestyle factors, insurance companies create a perception that policyholders should be held accountable for illness or injuries beyond individual control.

Details or Sample:
Should Insurance Companies Hold Policyholders Accountable for Being Sick?

Rescinding is a practice employed by insurance companies to deny a policy retroactively after the policy has been issued if the insurance company finds evidence that the policyholder provided false or misleading information on the application that would have initially led the insurance company to refuse coverage, or do so under conditions that are more restrictive. Under a rescinded policy, the policyholder could be made to pay back all monies the insurance company paid for medical bills and premiums paid on the policy will be returned to the policyholder.

Yet the fact that it is legal for an insurance company to rescind a policy presumes that the insurance company has the right, that it is acceptable, to base an individual’s rate, or refuse an applicant, on any number of factors including health history; preexisting conditions; age; weight; overall health; family health history; lifestyle choices; exercise; stress; occupation; habits; hobbies; sleep patterns; eating practices; vitamin, mineral and herbal intake; fluid intake; sex life; and exposure to dangerous diseases, virus, bacteria, or germs. If fact, any and all factors of a persons lifestyle, habits, or practices can trigger denial of coverage or an increased rate.

The fact that insurance companies can use the powerful fear of rescinding a claim to force individuals to divulge all pertinent information so they can be charged based on each tidbit of health, lifestyle and illness makes a basic presumption that if a person is ill, or will become ill, they should pay more, thus illness or injury, or potential illness or injury, should be penalized by cost, and that any efforts to avoid such penalty is fraud or misrepresentation.

This philosophy is ultimately perceived by the policyholder and by the public as a belief that an individual should be held accountable for illness and should be made to pay based on illness, injury or congenital defect, with the results of equating illness with responsibility or fault. This view is enhanced by the insurance companies who spout the legitimacy of their duty to hold the individual policyholder honest about health issues and base their rates accordingly, else the individual policyholder’s illness cost be disbursed to everyone else.

The error in this line of thinking is that no person could, or should, take responsibility, or be held accountable or penalized, for any illness, injury or congenital defect, as these are factors go beyond individual control. The old saying, “There but for the grace of God go I,” applies here and should be recognized by all.

Of futher interest is the difference in how health insurance companies handle group policies versus individual policies. Persons who enjoy a group policy, protected by the shroud of ‘the company’, are less likely to be asked probing questions and there is no rescinding of individuals within company policies. No individual underwriting is involved, thus the whole group is covered, or not covered, regardless of previous health or illness of any individuals within the group. Apparently, the insurance company has no qualms about spreading the burden of the ill upon the healthy within group coverage.

One wonders how such legal discrimination could be possible in a country that prides itself on the democratic principles of fairness and equality. Yet, it is evident that one group holding individual policies are subjected to micro-inspection of their lives by insurance companies looking for any excuse to jack over-inflated rates even higher, while another group relaxes in the security of ‘company policy’. Is there any factor other than cost for the insurance company that separates these two groups of people? Is one group blessed with better health and have lifestyles and hobbies that make them less disposed to be ill, have accidents or congenital defects? If it were found that the two groups are treated differently based not on health issues, but due to profitability for the insurance company, would that not be discrimination?

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Written by: jsfields
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