Can Blue Cross Blue Shield of North Carolina cancel insurance retroactively?
North Carolina is a tough state to retroactively cancel a policy as their DOI commisioner is popularly elected and has turned his post into a huge grandstand for constant reelection.
I've got to believe that BCBS has done their homework and crossed their Ts and dotted their Is on this.
There is likely tangible evidence of MATERIAL MISREPRESENTATION on the policy application that would have greatly effected the rates charged by BCBS or the insurability of the insured. Either would have to exist for a policy to cancelled not just flat but retroactively.
If this is the case, then BCBS would have to refund the collected premium paid on this former insured.
One can likely file a complain with Jim Long's office at the DOI in Raleigh but I have a feeling their is likly good evidence for this to happen.
Then the only recourse would have to be through attorney and courts. Coverage would then be granted while case is being heard but the insured would have to likely refund the monies BCBS paid to medical providers during this period.
Not if you paid the premiums.
If you are paid up, then you are paid up.
Unless and this is a big if......
If you submitted a fraudulent application and didn't disclose a material fact that would place you in a more risky category, then they can claim you filed a false application and can indeed cancel retroactively.
And, if they paid any claims under that policy they can demand that you repay them.
The biggest example of this happening is when somebody deliberately lies that they don't have a pre-existing condition and the insurer (BCBS) issues a policy and then after that catches a pre-existing condition on a policyholder's MIB (Medical Information Bureau) report. They'll void the policy and since a valid contact never originally existed, they'll take action to collect all paid claims up to that point.
It's a good reason why everyone should know exactly what's in their MIB report and take action to correct errors.
Answers:
Insurance companies can do just about whatever they want, and you have to challenge them in court. If you did not lie on the application or cause the cancellation, report this to the Bureau of Insurance licensing in your state.
Those big insurance companies work a lot like congress. They get away with anything they want!
Yes, an insurance company may cancel the policy retroactive to the effective date.
This is mostly done when the submitted application was fraudlent, regardless of the intent. If you happen to leave off major health information and then start filling large claims you are defintely risking being cancelled.
If the policy is canceled they will usually refund any paid premiums and retract any claims paid. You will be held liable for all claims.
You may be able to appeal their decision, contact the customer support line or your agent.
It is always better to disclose too much on an application! You never know what may haunt you later.
Only if it's because you replaced coverage with another policy, they haven't had any claims submitted during the time period in question, and it's less than six months.