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Insurance firms defend rescissions as fraud control

Washington Post, September 8, 2009

Rescission, or canceling insurance coverage on grounds that the company was misled, has become central to the healthcare debate as President Obama tries to tap into dissatisfaction with the insurance industry to build support for reform efforts. Each of the bills pending in Congress would prevent insurers from rejecting clients because of preexisting conditions. Insurance company officials say they need to be able to cancel policies to control fraud, which by some estimates reaches $100 billion annually.