Class Claims AARP Bilking Seniors Through Insurance Commissions [View all]

A class action claims AARP is pocketing millions by duping unsuspecting seniors and disabled individuals into paying artificially inflated prices for Medicaid supplemental health insurance policies.

In a federal complaint filed in Fort Pierce, Florida on Thursday, lead plaintiff William Sacco claims AARP is collecting unconscionable commissions on insurance policies it sells in partnerships with co-defendants UnitedHealth Group Inc. and UnitedHealthcare Insurance Company.

Sacco, who is represented by Scott Bursor from Bursor & Fisher PA, claims that AARP refers to these commissions as “royalty” payments for the use of its intellectual property, and fails to disclose that they are collected by charging seniors and disabled individuals an additional amount over and above the insurance premium paid to UnitedHealthcare.

“Defendants’ motive to term a commission payment a “royalty” is two-fold: it allows AARP to avoid oversight by insurance regulators, and it allows AARP to avoid paying taxes on the income it generates through insurance sales,” Sacco says.

According to the complaint, AARP is violating the Florida Insurance Code because even though it does not have a license to operate as an insurance agent in Florida, it still acts as a “de facto agent” for UnitedHealth by selling and renewing “AARP Medigap” insurance policies in exchange for a 4.95 percent commission.

https://www.courthousenews.com/class-claims-aarp-bilking-seniors-through-insurance-commissions/