Survey Targets Insurance Misinformation

Consumers who turn to their state insurance regulators for help when shopping for health or automobile insurance may be getting bad information, a survey released Thursday found.

A national study by the Center for Insurance Research indicated that state insurance regulators provided correct answers to basic questions about health insurance between 43% and 65% of the time.

For auto insurance, questions were answered correctly between 26% and 90% of the time, said the center, a Cambridge, Mass.-based consumer advocacy group.

Many state insurance regulators “are apparently dropping the ball either because of a lack of resources or because they do not make consumer services a priority,” attorney Robert Schneider said.

The National Assn. of Insurance Commissioners, which represents state regulators, didn’t immediately return a telephone call seeking comment.

A spokesman for the Insurance Information Institute, the industry’s information clearinghouse, said he wasn’t surprised by the findings.

“We are the public relations arm of the industry, and we have had difficulty sometimes getting information from the states,” said Steven Goldstein, Insurance Information Institute spokesman.

The study is a national sample of 38 states conducted by trained interviewers who asked basic questions about insurance.

And 65% of the time, regulators answered correctly that health coverage could be limited because of preexisting medical problems.

But consumers were told incorrectly 26% of the time that they could be rejected for auto coverage because they lived in a low-income community.

In only 43% of the cases were consumers correctly told they could receive health insurance from an insurer of last resort or a special insurance pool if they had already been rejected by other insurance companies.

It showed only 65% of the regulators correctly told consumers about how their health coverage would be limited because of preexisting medical problems.

On automobile insurance, the survey said consumers were incorrectly told 32% of the time that insurance agents worked for consumers and failed to caution them about potential conflicts for agents, such as attractive commissions.