Dental Insurance Articles
How Dental Insurance Is Regulated From State To State
2010-09-23
All forms of insurance are affected by the law, and dental insurance is no different. Insurance regulations in different states can have a profound effect on how dental insurance companies do business, and understanding this effect can be very helpful when looking for a fair, low-cost policy.
Dental insurance companies are subject to the same insurance regulations as auto insurance companies, health insurance companies and others in the insurance industry. These regulations may be simple or complex, and there are a few that are designed especially for dental insurers. Most state insurance regulations are designed to allow all companies to compete and operate in a way that's fair for consumers. For instance, a state may prevent insurance providers from putting an inordinate amount of exclusions in a contract, and all states require dental insurance companies to give a reason when they deny a policy holder's claim. In many states, dental insurance companies are also required to explain in clear language what each type of coverage offers. States usually require dental insurance companies to explain how their premiums are formulated, and may outlaw certain types of discrimination. For example, charging people of a certain race, ethnicity or handicap status more for their dental insurance policies. However, insurance law does vary from one state to the next. In general, states with more insurance regulations tend to have higher average rates of dental insurance due to the higher cost of doing business.
All dental insurance companies are also regulated by the ADA (American Dental Association), which provides additional guidelines and can act as a mediator when a policy holder wants to dispute a claim resolution or when insurance customers have complaints about a particular company. The ADA has contracts with dental insurance companies, which establish penalties for breaking guidelines and laws. These penalties usually include harsh fines and they're an effective incentive; most dental insurance companies would rather operate legitimately then risk any of these fines.
Insurance customers with policy issues should check into both ADA guidelines and their state of residence's insurance regulations in order to determine whether a dental insurance company is acting unfairly or illegally. Both the ADA and every state's insurance commission have a website, and most provide clear instructions for insurance customers who are looking to make a complaint. Knowing a few of your state's insurance laws can be a very good idea, as this information can be valuable when looking at dental insurance quotes. Insurance law is designed to prevent dental insurance companies from taking advantage of policy holders and it's an important regulator in the world of insurance.