Mich. DOI Takes 6,500 Complaints in 2002

The Michigan Office of Financial and Insurance Services released complaint ratios for insurance companies in Michigan, noting it received more than 6,000 responses from around the state.

“The increase in the reported statistics can be attributed to two factors—market conditions and OFIS outreach efforts,” said Office of Financial and Insurance Services Commissioner Linda Watters. “A notable change in one’s insurance rates prompts plenty of complaints and the information push OFIS has used to educate consumers on insurance coverage has made us the recognized source for information and assistance.

“In 2001 our consumer assistance help line received 174,276 calls for assistance or file a complaint in regards to insurance, securities, mortgage lenders or banks and credit unions matters. In 2002, our calls jumped to 190,970,” added Watters. The OFIS web page posting provides information on how to file a complaint as well as complaint statistics. Also, a statistical review option on the Web site provides a breakdown of overall complaints, which provide:

Total insurance complaints for 2002—6,543. That total breaks down to: Insurance Company Complaints – 3,845, Blue Cross Blue Shield Complaints—998, HMO Complaints—625, and other complaints—1,075.

Line of coverage—2002 complaint totals for types of insurance like accident and health, annuity, automobile, homeowners, and life.

Complaint reason—2002 complaint totals for types of complaints like marketing and sales, claim handling, policyholder services, and underwriting.

OFIS receives thousands of complaints every year regarding the insurance industry. After responding to the complaints, the information is used to track pattern of practice and compiled into complaint ratios. Ratios are determined by dividing the dollar amount (in millions) of written premium into the number of filed complaints. The resulting ratio provides complaint information that takes into account the size of the insurance company.

Another review option on the OFIS Web site is complaint ratios that provide information for specific Michigan insurance companies. Complaint ratios are available for companies by type of insurance coverage, including accident and health, annuity, automobile, homeowners and life. Complaint ratios are listed for all Michigan insurance companies that receive over ten complaints in a calendar year. The complaint ratio statistics also offer the option of additional insurance company information.

By clicking on the company name, users link to the company address, company contact, and complaint reason information. Complaint information can be used as a tool to help consumer chose an insurance provider, but other factors should be acknowledged when evaluating a company. Such factors are premium charged, benefits provided by the contract, financial stability of the company, and levels of service provided.

It is also important to remember that not all complaints filed result in a determination that the insurance provider acted improperly. The complaint information filed at OFIS and posted to the web includes complaints filed against agents offering insurance products from companies.