The Minnesota Department of Commerce fined a company and its owner for repeatedly misleading up to 1,000 Minnesotans about health insurance coverage.
The department said it fined Seguro Medico and its owner, Arthur Walsh, $150,000 after Minnesotans complained they believed they were buying comprehensive health insurance.
Investigators found Walsh and Seguro Medico repeatedly violated Minnesota insurance laws. Investigators said the company sold plans with limited benefits that did not cover a majority of medical services and prescription costs.
“When consumers believe they’re protected only to discover their coverage doesn’t match what they were promised, the financial consequences can be devastating,” said Commerce Commissioner Grace Arnold.
The company also failed to report regulatory actions in other jurisdictions, accepted insurance business from unlicensed individuals, used an…
Insurance fraud involves making false or exaggerated claims to an insurance provider.
- Hard Fraud: Someone deliberately causes a loss (e.g., setting fire to a warehouse or staging a car accident) specifically to collect a payout.
- Soft Fraud: More common and often viewed as “victimless” by the perpetrator. It involves exaggerating a legitimate claim, such as overstating the value of stolen items in a home burglary to cover the deductible.