Oregon and California have joined the chorus of states asking insurers to show grace to federal employees as the U.S. government shutdown continues.
Acting Oregon Insurance Commissioner T.K. Keen issued a bulletin on October 20, encouraging insurance companies, as well as other entities regulated under the state’s insurance code, to take active measures to help those affected by the shutdown, including federal employees subject to furlough or those required to work without pay.
Keen recommended insurers provide Oregon residents with a grace period of at least 30 days for premium payment; refrain from involuntary cancellations or non-renewals for affected residents; wave or provide flexible options for late fees or other consequences related to premium payments; extend claims deadlines; and provide clear communication and proactive customer service for affected Oregon insureds.
California Insurance Commissioner Ricardo Lara issued a formal notice on October 24, urging insurance companies in the state to implement protective measures for policyholders who rely on federal funding to pay their premiums.
This action, a press release states, impacts around 160,000 civilian workers in the state who could face cancellation or non-renewal of their insurance policies if they are unable to pay their premiums. Lara's call for mercy also extends to small businesses and others affected by the interruption of federal contracts and grants.
“Nobody should lose their health or home coverage because of Congress's ongoing inaction, especially during the current insurance crisis and challenging market conditions in our state,” Commissioner Lara said in a release. “The federal government shutdown has serious consequences for Californians who are already struggling to find coverage and affordable options. It is crucial for us at the state level to take every possible measure to protect our civil servants and those who rely on federal funds during this leadership crisis and neglect of duty.”
Lara requested that insurance companies take similar actions to those encouraged by Keen in Oregon, including extending payment grace periods, waving late fees and penalties, and extending claims and underwriting deadlines.
Earlier in October, both Illinois and Maryland’s Departments of Insurance also formally requested that insurers in their states offer relief to affected federal employees in order to prevent lapses in coverage.
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