q111/random_k4/random_3.md

Colorado Division
of Insurance Annual
Complaint and
Recoveries Report
FY 2022-23 (July 2022 - June 2023)

Contents
Facts and Figures  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �   4

Digging Deeper Into Issues �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �   6

Marshall Fire and Homeowners Insurance

6

Extending Additional Living Expenses � � � � � � � � � � � � � � � 6

Meeting Insurance Requirements � � � � � � � � � � � � � � � � � � 7

Policy Reformations � � � � � � � � � � � � � � � � � � � � � � � � � � � 7

Digging Deeper Into Issues �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �   8

Helping Coloradans Navigate Health Insurance

8

Behavioral Health � � � � � � � � � � � � � � � � � � � � � � � � � � � � 8

Gender Affirming Care � � � � � � � � � � � � � � � � � � � � � � � � � 9

Diabetic Supplies & Services � � � � � � � � � � � � � � � � � � � � � 9

Preventive Screening vs Diagnostic Services � � � � � � � � � � � 9

Consumers’ Stories  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  �  � 10

HOA Policy Not Renewed  � � � � � � � � � � � � � � � � � � � � � � 10

Policyholder Receives Additional $513,000 in Coverage  � � 10

The HOA sent the Division this message. � � � � � � � � � � � � 10

Denied Claim Reversed  � � � � � � � � � � � � � � � � � � � � � � � 11

$2,000,000 Life Insurance Payout Secured � � � � � � � � � � � 11

Improper Delay for Life Insurance Claim � � � � � � � � � � � � 11

Contact the Colorado Division of Insurance   �  �  �  �  �  �  �  �  �  �  �  12

2  |

Colorado Division of Insurance Annual
Complaint and Recoveries Report

FY 2022-23 (July 2022 - June 2023)

The Colorado Division of Insurance (DOI), part of the Department of Regulatory Agencies
(DORA), regulates insurance in Colorado - both the insurance companies and insurance agents/
brokers. But the DOI also serves as a resource for Coloradans on all insurance matters. We
answer consumers’ questions, investigate their complaints and generally explain the world
of insurance. Most of this work is done by the Consumer Services Team, which is split into
two components - Property & Casualty Insurance and Life & Health Insurance. The team also
connects with other DOI teams as necessary, especially when systemic issues with insurance
companies are identified.

This report covers the complaints that came into the DOI, the work in investigating the
complaints, and the money we recovered for consumers throughout the 2022-23 fiscal year
(FY 2022-23; July 2022 - June 2023). In that time, the Consumer Services Team saw an
increase in complaints compared to the previous year.

For the Life & Health side of the team, much of the increase centered around the exit of
Bright Health from Colorado’s health insurance market at the end of 2022, as well as the lead
up to the termination of Friday Health Plans of Colorado in the spring and summer of 2023.
Ensuring access to care for Colorado consumers continued to be top of mind for the DOI in
working through consumers’ issues.

For the Property & Casualty group, the increase in complaints is likely attributable to the
DOI’s increased visibility as a resource in the area of homeowners insurance due to our work
and assistance in the aftermath of the Marshall Fire. And while the team did not receive as
many complaints related to the Marshall Fire in this past year, much of their work was still
focused on investigating and resolving complaints from the previous year related to the fire.

  | 3

Money Recovered for
Colorado Consumers

Facts and
Figures

This is money that goes to consumers in situations
where the DOI finds that an insurance company
improperly denied a claim, or did not initially pay
the correct claim amount. Recoveries can also
come about when a company is delaying payment
on a claim or has not followed State insurance laws
and regulations.

Property & Casualty Insurance

Money recovered
specifically on Marshall
Fire complaints

Money recovered on all other Property & Casualty
Insurance complaints

$3,756,555

$9,759,961

$13,516,516
total recovered

Life and Health Insurance

Money recovered
specifically on health
insurance complaints

Money recovered on
complaints about Life
   Insurance, Long-Term
      Care and Annuities

$4,969,764

$3,036,786

$8,006,550
total recovered

Total Money Recovered
for Colorado Consumers
$21,523,066

$19,630,350

$21,523,066

FY 21-22

FY 22-23

Money recovered for
Colorado consumers by
fiscal year

4  |  Facts and Figures

Facts and Figures

Property & Casualty
Insurance Complaints

Life & Health
Insurance Complaints

Complaints
specifically related
to Marshall Fire

99

1,734

Complaints
specifically related
to Health Insurance

Other complaints
about Property
& Casualty
Insurance

3201

Total Combined
Complaints Resolved
5,920

886

Complaints about
Life Insurance,
Long-Term
Care and Annuities

Total Property &
Casualty Insurance
Complaints Received

3,300

Complaints and
Inquiries Closed
3,733

2,620

Total Life & Health
Insurance Complaints
Received

Note:  Some  complaints  take  longer  than  others  to  fully
investigate, so not all complaints are resolved in the year they
are received. The 5,920 figure includes 1,849 inquiries, which
are instances when a consumer’s complaint involves an easily
resolved question or falls outside of the DOI’s authority to
regulate. These complaints still require the Consumer Services
team to contact the consumer to answer their questions and
educate them on their options.

Telephone Calls: 9,000

The Consumer Services Team typically fields around 9,000
phone calls from consumers in a year. Calls can range from
simple questions regarding a claim or policy to inquiries about
a company’s actions and how to move forward with a formal
complaint.

9,000

Facts and Figures | 5

DOI’s Work

Digging
Deeper
Into Issues

Marshall Fire and
Homeowners Insurance

Even though the Marshall Fire happened
in December 2021, the Division continued
to investigate complaints related to the
fire during this past year. And while the
DOI investigated each of the individual
complaints, working with policyholders
on their specific problems and questions,
our work also turned up a number of
issues that impacted broader groups of
Marshall Fire survivors.

Extending Additional Living Expenses

The DOI Consumer Services Team discovered that
an insurance company had placed dollar limits on
Additional Living Expenses (ALE), which was not
allowed under State law. This impacted a number
of policyholders who had lost their homes in the
Marshall Fire. The Division required the insurance
company to review all policies connected to the
Marshall Fire, and to correctly apply the ALE, with
no dollar limit, for the first 12 months after the
fire. The result was that the Marshall Fire survivors
with policies from this company received further
ALE benefits, as they were no longer restricted by
a dollar limit.

6  |  DOI’s Work - Digging Deeper Into Issues

Digging Deeper Into Issues

Meeting Insurance Requirements

Policy Reformations

The DOI discovered that an insurance company had
not been making necessary coverage available to
policyholders as required by law - specifically the
company  was  not  offering  a  minimum  of  10%  of
Ordinance & Law (O&L) coverage and 20% of Extended
Replacement coverage. A number of policyholders in
the Marshall Fire were impacted by this omission. Due
to the Division’s investigation, the company amended
these policies, updating the coverage and providing
additional benefits to these survivors.

One  of  the  major  issues  that  became  apparent
immediately following the Marshall Fire was that many
people found themselves underinsured. As a result,
many people sought to reform their policy. While most
insurance companies refused to change their policies,
the DOI was able to get some companies to reform
policies. This resulted in adjustments that sometimes
ran up to six-figures of increased coverage available
to rebuild homes.

DOI’s Work - Digging Deeper Into Issues | 7

DOI’s Work

Digging
Deeper
Into Issues

Helping Coloradans Navigate
Health Insurance

While  the  DOI  continues  to  develop
programs to increase access to health
insurance  and  save  people  money  on
health care, our Consumer Services Team
works to help people understand their
coverage and benefits, and help them
navigate  the  various  issues  that  arise
when they interact with our health care
system.

Gender Affirming Care

The Consumer Services Team assists LGBTQ Coloradans seeking
gender-affirming care, often helping individuals to obtain approval for
network gap exceptions so they can use out-of-network providers for
their gender-affirming care needs, as insurance companies’ provider
networks are frequently unable to provide for such services. This
intervention by the DOI results in insurance companies addressing
shortcomings  and  gaps  in  their  provider  networks,  and  most
importantly, often assigning  a case manager who has experience
with gender-affirming care to assist the member as they navigate the
system for future care needs.

8  |  DOI’s Work - Digging Deeper Into Issues

Digging Deeper Into Issues

Behavioral Health

Diabetic Supplies & Services

Preventive Screening
vs Diagnostic Services

As more Coloradans seek behavioral health services, the DOI Consumer
Services  team  continues  to  receive  complaints  about  insurance
companies’ provider networks and improper denials of mental health
benefits. To address these issues, the team began working with the
Division’s Behavioral Health Programs section, to specifically review
complaints submitted by mental health providers. Together, these
teams are working to identify systemic issues with insurance companies
around mental health parity laws and regulations, determine if further
investigation is needed, and identify any corrective actions needed to
protect Colorado consumers.

An important benefit for many enrollees in the Colorado Option health
plans are the diabetic supplies and services with no cost sharing for
members  (no  copayments,  deductibles  or  coinsurance).  However,
early in 2023, the first year the Colorado Option plans were available,
the Consumer Services Team received a number of complaints from
consumers who were being required to pay cost shares for their diabetic
supplies, like continuous glucose monitors. The team worked with the
Division’s Colorado Option section to identify the root of the problem,
resulting in additional guidance being provided to insurance companies
(Bulletin B-4.130) on how to comply with the Division’s regulations on
coverage requirements for Colorado Option plans relating to diabetic
supplies and services.

In the last year, the Consumer Services Team noticed an emerging pattern
in complaints related to screening colonoscopies. Many health insurance
companies were using the United States Preventive Services Task Force
(USPSTF) recommendations to process colonoscopy claims, but had not
updated their processes to include Colorado’s more consumer-protective
coverage requirements found in State law. The Consumer Services team
worked with the DOI’s Market Regulation section to conduct a wider
review of insurance companies’ practices, resulting in substantial savings
to consumers and a correction of companies’ claim handling processes
going forward.

DOI’s Work - Digging Deeper Into Issues | 9

Consumers’ Stories

HOA Policy Not Renewed

In March 2023, the Division’s Consumer Services Team received a complaint from a homeowners association (HOA)
concerned about their commercial property policy not being renewed. Their property had been affected by the
Marshall Fire, and they suspected their insurance company had not renewed their policy based solely on that
association with the Marshall Fire, which was not allowed. Making the matter even more urgent, the policy was
set to expire in 14 days. The Consumer Services team asked the insurance company for an explanation for the non-
renewal, as well as a reconsideration of this action based on state law and regulations. After this, the insurance
company changed course and renewed the policy for the HOA.

The HOA sent the Division
this message.

“Thank you for all you did to help us with our appeal. We received the
notice on Monday that our insurance company would reverse their non-
renewal and we’re expecting the updated renewal quote today. It was truly
some of the best news I’ve received in a long time, and I can’t thank you
enough for your help in guiding us and taking the reins on our complaint.
For myself, the board and our entire community, thank you for your help
and all you do.”

Policyholder Receives Additional $513,000 in Coverage

A policyholder purchased their home and homeowners insurance policy in August 2021.
Their agent provided a replacement cost value, excluding the basement, and indicated
the coverage would be sufficient. After the Marshall Fire, the coverage was not
sufficient, and the insurance company determined the cost to rebuild the home would
be over $1 million. The consumer contacted the Division about the possibility
of reforming the policy. After an investigation into the consumer’s concerns,
the company agreed to reform the policy, which resulted in an additional
$513,154 in coverage for the homeowner.

10  |  Consumers' Stories

Consumers’ Stories

Denied Claim Reversed

A consumer who lost their home in the East Troublesome Fire had their claim for a total loss denied by their
insurance company. The home had been purchased shortly before the fire and the policy was new. However, the
insurance company denied the claim, saying there was not an active policy covering the home. When the complaint
was filed, the Division contacted the insurance company and determined that this discrepancy was due to an agent
error. The company reversed its denial of the claim, resulting in a payment of $500,703 to the insured.

$2,000,000 Life Insurance Payout Secured

After filing a life insurance claim in February, a consumer was advised by the insurance company in March that
the payout would be sent “within 7-10 days.” By mid-April there was still no payout and the consumer filed a
complaint with the Division. By April 26 the payout was processed and the consumer received the policy benefits
of $2,000,000, plus $25,000 in interest for the delay.

Improper Delay for Life Insurance Claim

A consumer filed a life insurance claim after the passing of her husband, and the insurance company initially said
the claim would be resolved within 10 days. Yet after many months, the claim was still unpaid. The consumer
eventually filed a complaint with the Division. The Division determined the company was improperly applying
the contestability clause in the policy (if a policyholder dies within the first two years of holding a life insurance
policy, the insurance company almost always conducts an investigation and reviews medical records to make sure
the claim should be paid). The Division was able to secure the $500,000 policy payout to the beneficiary, along
with an interest payment of $17,000 due to the delay.

Consumers' Stories | 11

Contact the Colorado Division
of Insurance

If you have questions, concerns or complaints about your insurance,
insurance company or insurance agent, or you just need an explanation
of terminology, processes or the world of insurance in general, please
contact the Colorado Division of Insurance Consumer Services Team.

303-894-7490

DORA_Insurance@state.co.us

doi.colorado.gov