Blumenthal gives thumbs up to DOI, Assurant settlement

John O'Brien May 19, 2008, 2:58pm


HARTFORD, Conn. (Legal Newsline) - Connecticut Attorney General Richard Blumenthal's opinion of the state's Department of Insurance has apparently flip-flopped in a little more than a year.

After criticizing the DOI's handling of a settlement with specialty insurer Assurant last March, he praised the DOI Friday for imposing a stiff penalty on the company.

Two Assurant companies -- John Alden Life Insurance Co. and Time Insurance Co. -- will pay $2.1 million in penalties to the State, on top of nearly $1 million in restitution to policyholders who claim they were wrongly denied coverage.

"This settlement sends a message that we will pursue and punish health insurers who betray our citizens with deceptive and dishonest use of technical excuses and ruses," Blumenthal said.

"We will continue the fight for additional restitution to anyone treated unfairly and denied coverage illegally. At our urging, the Legislature has closed gaps in our law that permitted misuse of supposed pre-existing conditions as a reason to reject coverage requests."

Last year, Blumenthal was upset that a settlement reached with Assurant did not provide for any penalties for the State, only restitution to consumers.

"This order is tantamount to telling a thief to return stolen money -- but imposing no punishment," he said. "Patients will finally get the benefits that we vigorously fought tenaciously to achieve for them, but this order fails to impose the significant penalties warranted for Assurant's abusive, anti-consumer practices.

"This step is a tap on the wrist -- not even a slap -- and, even worse, may tie our hands in pursuing more aggressive legal action under insurance statutes."

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