Is this even legal?

[MIGA1626]

I have a carrier that I work with that has demanded that all billing on current policies be accelerated by 2 months. Meaning all the payments that come out today with be TRIPLE BILLED. Is it legal for a carrier to do this without the customer agreeing in writing and without any warning? You maybe thinking "surely they warned people" the answer is no.... they didn't... it was even ambiguous that there was warning. This seems to me criminal that you can do this. Their response is literally just deal with it or we will cancel your policy.

 

[adjusterjack]

Step 1 - Call your insurance department and see if there is any insurance statute that applies. If there isn't, then it's legal.

Step 2 - Read whatever contract you have with the carrier and see if the new billing requirement breaches your contract. If it doesn't, there's one more try.

Step 3 - Read the policies that this may affect and see if it breaches those contracts. If it does, file a written complaint with your insurance department.

If there is no prohibition against the billing method you are probably stuck with it unless you want to dump that carrier and replace all the business.

Are you a member of an agents association? If not, I suggest you join one and see what the association is doing about it, if anything. Other agents may be in the same boat.

 

[PrivClientSG]

I have a carrier that I work with that has demanded that all billing on current policies be accelerated by 2 months. Meaning all the payments that come out today with be TRIPLE BILLED. Is it legal for a carrier to do this without the customer agreeing in writing and without any warning? You maybe thinking "surely they warned people" the answer is no.... they didn't... it was even ambiguous that there was warning. This seems to me criminal that you can do this. Their response is literally just deal with it or we will cancel your policy.

I would contact the respective DOI (Department of Insurance). Premium payment is covered in the language, terms, and conditions of the policy. If they are doing this, it would have to be covered in the policy language. I saw carriers give concessions on premium payment during the global pandemic, but even that had to fall within the confines of DOI's.

I would also contact various industry organizations and talk to them about this. They may already be on this and doing something about it. If not, they might do so. Good luck!

 

[MIGA1626]

Update on this situation. I negotiated with them and met half way. There billing process bills for a month behind rather than forward like most carriers. I got them to just do one extra payment to accelerate into prorated payments rather than arrears... so... crisis averted no one is mad at me they understand. Once again: thanks for being my therapist.

 

[tikibarrister]

Who is the carrier?

 

[Sean Alott]

Quarterly billing is a normal practice for carriers that offer 'Pay by Mail' billing.

 

[DayTimer]

Is it legal for a carrier to do this without the customer agreeing in writing and without any warning?

It is not legal IF the insurance agreement meets the legal definitions of a contract AND the language of the contract does not explicitly give the carrier the right to do so.

At least that's what I would say if I were a lawyer, which I, admittedly, am not.

Who is the carrier?

 

[PrivClientSG]

Did you follow up on this? Who is the carrier? Was this case/class specific or across the entire board? Nationally?

Like I said, unless this was allowed via policy language in the contract -- no, they would not be able to do this. Warning people doesn't matter. The contract MUST allow it. Can you post your follow up on this please? Thanks!