The action is the result of a Department of Banking and Insurance investigation and a consent agreement. I am also proud of the Division of Enforcement and Consumer Protection for having fought so effectively on behalf of those families and individuals. The company insisted that the girl's condition was a pre-existing condition, therefore making her ineligible for coverage.
Records show, however, that the daugher's condition was diagnosed after the policy took effect.
This case, as well as the others cited in the investigation, should make it clear to the industry that we will be aggressive in enforcing the law. The dispute between NHIC and insurance officials began when regulators found that the insurance offered by the carrier through USA for Health Care did not meet New Jersey standards. Regulators also determined that because the association itself guaranteed 10 percent of the insurance risk, it was in violation of the law requiring all entities conducting the business of insurance in New Jersey to be licensed by the state. NHIC argued that it was exempt from New Jersey requirements under federal law but the state pressed its challenge. The dispute was resolved when NHIC signed a consent agreement with the Department of Banking and Insurance that required it to recalculate its benefits to meet New Jersey's standards, pay its claimants accordingly and otherwise comply with state law.