Insurance officials in Maine and Massachusetts have joined a Tennessee investigation of claims handling by UnumProvident Corp., the nation’s largest disability insurer.
The company, one of Portland’s biggest private employers, has been fined by regulators and sued by policyholders and investors. It has major business operations in the three states.
“What we’re trying to accomplish here is a coordinated approach,” said Eric Cioppa, deputy superintendent of the Maine Bureau of Insurance. “Hopefully this is good for everyone involved, in that we can go in and find out what’s going on in an efficient manner.”
The states each regulate parts of UnumProvident’s domestic business, said Cioppa. Rather than have numerous investigators auditing how claims are handled, he said, regulators will coordinate their findings into a single report to the National Association of Insurance Commissioners.
The insurer welcomed the effort, said Linnea Olsen, UnumProvident spokeswoman.
“We are very pleased that they’re doing this,” she said. “From our standpoint, we have nothing to hide and we would prefer that they’re doing it this way. It’s a more efficient way to do exams.”
Olsen said investigators visit UnumProvident frequently because it’s the responsibility of state regulators to audit insurers every few years or so. After much-publicized claims were made against UnumProvident last year, Olsen said, there was increased interest in doing audits.
“State regulators felt it was their responsibility to see if there’s any merit to these allegations,” she said. “The three states have decided it’s more efficient to do it this way.”
Tom White, UnumProvident’s vice president of corporate relations, said company officials are confident the investigations will validate the insurer’s performance. UnumProvident says it has about 30 percent of the nation’s disability insurance business.
The company was fined $1 million in March by Georgia insurance regulators after an investigation of its claims handling. Georgia State Insurance Commissioner John Oxendine said UnumProvident had a corporate mentality of “looking for every technical legal way to avoid paying a claim.”
Chris Goetcheus, a spokesman for the Massachusetts Division of Insurance, said that agency started its review of UnumProvident early this year. “It’s a work in progress,” he said.
Paula Wade, a spokeswoman for the Tennessee Department of Commerce and Insurance, said Tennessee is looking at the company “in the context of what other folks have found. We’re looking at the potential patterns of conduct.”
She said the states plan a unified report “fairly soon.”
Hundreds of lawsuits have been filed by policyholders who contend the company routinely denies claims and requires its medical employees to support the denials.
UnumProvident also has been hit with lawsuits from shareholders who claim it made misleading statements about its finances.
The company is searching for a successor to chief executive J. Harold Chandler, who was ousted in March. White said the search is continuing.
UnumProvident and its subsidiaries have about 13,000 employees, including about 3,600 in Portland, about 3,000 in Chattanooga and about 800 in Worcester, Mass.