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Connecticut health insurance companies can drop you but only in certain circumstances. Insurance companies can drop you if you fail to pay your premiums on time or if you make a material misrepresentation.

Insurance companies cannot cancel your insurance coverage simply because you file a major claim or if your health has taken a turn for the worse. The crucial issue is whether or not you met their underwriting standards on your policy’s effective date.

Your contract won’t be cancelled if you simply post your payment a few days late either. You can expect to have a 30 day grace period to give you some leeway if you cannot make your premium payment on time.

If you have made a material misrepresentation on your health insurance application your company may be able to rescind your contract. The important word here is “material.”

A simple misstatement is not enough to cause a medical insurance policy to be rescinded. If the policy would have been approved had they known the correct information they cannot rescind the contract. This is based on the underwriting guidelines in effect at the time.

I have been an insurance agent for over 25 years now and have never had a client’s policy rescinded. I think that this is for two reasons. Most people complete their applications honestly. And the insurance companies usually check medical records and will simply fail to approve most applications where the applicant has a significant medical issue.

Health insurance companies can only cancel a contract based on a misrepresentation during the first two years of a contract. They also have to refund all of the premiums you paid minus any money they have paid in claims on your behalf.

The companies have more latitude if you do something like have another person take your exam. They can go beyond the two year limit, but this happens very rarely.

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Alston

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