Ohio Department of Insurance Director Ann Womer Benjamin announced that two Department initiatives designed to protect consumers from fraudulent health insurance policies and to simplify liquidation proceedings involving failed insurance companies were recently introduced into the Ohio House of Representatives. House Bill 281 is sponsored by state Representative Earl Martin (R-Bay Village) and House Bill 282 is sponsored by state Representative Larry L. Flowers (R-New Albany).
“As the largest consumer protection agency in the state, the Department is spearheading this important legislative action to ensure a safe and stable marketplace for consumers and small businesses,” said Womer Benjamin. “These bills provide increased security for individuals shopping for health insurance and protection for small businesses dealing with insurance companies prior to liquidation.”
House Bill 281 protects consumers from fraudulent health insurance carriers by increasing the penalties for those who take part in the selling of scam health insurance policies. In 2003, two cases of scam policies have been uncovered in Ohio, including a recent case reportedly involving TRG Marketing, LLC and two agents selling TRG products in the Cincinnati area.
Additionally, HB 281 clarifies the certificate of compliance issued by the Department to out-of-state insurers. The new certificates, if approved by the legislature, will be designed so that the Department can attest that the company in question is in compliance with all of the insurance laws in the state of Ohio.
Current law requires the Department to recover payments made in the ordinary course of business during liquidation of an insurer, which is overseen by the Department. House Bill 282 changes the law to relieve small businesses from the burden of re-paying money received for services rendered during the ordinary course of business.
Furthermore, the legislation will reportedly define preference payments as payments made to certain creditors outside the scope of ordinary business.
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