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Ban on retroactive cancellations of insurance policies approaches

The Chicago Tribune, July 6, 2010

One of the most controversial issues related to health insurance has been rescission, which is action taken by insurers to retroactively cancel a customer's coverage even if a policy is kept current, citing omissions or errors in the application as grounds for breaking the contract. And Illinois has had among the highest rescission rates in the country. Because of the new federal healthcare laws, starting in September, rescissions will no longer be allowed, except in the case of fraud.