Superintendent of Financial Services Adrienne A. Harris announced today that the New York State Department of Financial Services ("DFS") has entered settlements totaling $4.6 million with 4 Ever Life Insurance Company, Aetna Life Insurance Company, UnitedHealthcare Insurance Company of New York, and Wellfleet New York Insurance Company, for charging unapproved rates to students covered under blanket health insurance contracts with educational institutions. DFS also fined 4 Ever Life and Aetna for using unapproved policy forms. Aetna, UnitedHealthcare, and Wellfleet will reimburse $3.2 million to students.

“All insurers doing business in New York are required to comply with New York Insurance Law, and with DFS’s oversight ensure they are charging consumers accurate fees and providing correct, current information,” said Superintendent Harris. “DFS is committed to upholding the integrity of the insurance market and protecting the interests of New York’s students.”

As part of its annual review of student health insurers in the New York market, DFS found that the four insurers charged unapproved premium rates to students covered under blanket health insurance contracts with institutions of higher learning. Through these actions the insurers may have gained an unfair competitive advantage in the student blanket health insurance market in New York.

Under the consent orders, 4 Ever Life Insurance Company will pay a civil penalty of $300,000, and Aetna Life Insurance Company will pay $2,750,000 for charging unapproved rates and using unapproved forms. In addition, Aetna will reimburse $1,650,139 to students; the company has already returned $160,823 to students. United Healthcare Insurance Company of New York will pay a civil penalty of $1 million, and Wellfleet New York Insurance Company will pay $500,000 for charging unapproved rates. UnitedHealthcare will reimburse a total of $1,379,625 to students, and Wellfleet will reimburse $84,333.

For the 2020-2021 academic year, 4 Ever Life Insurance violated Insurance Law §§ 3201(b) and 3231(d) and 11 NYCRR 52.21(f) by issuing policy forms and premium rates to 11 institutions of higher education that were not approved by DFS for use in the 2020-2021 academic year.

DFS’s review found that for the 2019-2020 and 2020-2021 academic years, Aetna violated Insurance Law § 3201(b), 3221(l)(5), 3231(d), and 3240(d) and 11 NYCRR 52.21(f). The company entered into agreements with 5 institutions of higher education in 2019-2020 and 12 institutions of higher education in 2020-2021 using premium rates that deviated from the approved methodology and included premium rating factors not on file with DFS. In addition, Aetna issued policy forms that did not conform to the policy forms approved by the Department to 13 institutions of higher education in 2019-2020 and 17 institutions of higher education in 2020-2021.

For the 2019-2020 and 2020-2021 academic years, UnitedHealthcare violated Insurance Law § 3231(d) and 11 NYCRR 52.21(f) by entering into agreements with 65 institutions of higher education using premium rates that deviated from the approved methodology and included premium rating factors not on file with the Department.

For the 2019-2020 and 2020-2021 academic years, Wellfleet violated Insurance Law § 3231(d) and 11 NYCRR 52.21(f) by entering into agreements with 32 institutions of higher education using premium rates that deviated from the approved methodology and included premium rating factors not on file with the Department.

Copies of the Department’s consent orders with 4 Ever Life Insurance Company, Aetna Life Insurance Company, UnitedHealthcare Insurance Company of New York, and Wellfleet New York Insurance Company can be found on the DFS website.