Insurance company owes Washington $1.5 million in mental health discrimination case
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PORTLAND, Ore. (KOIN) — The world’s largest insurance provider owes $1.5 million to hundreds of Washington residents following a lawsuit that accused the company of discriminating against people experiencing mental health issues.
Washington Attorney General Bob Ferguson revealed the results of his lawsuit against Allianz, which sells travel insurance to millions in the state, on Wednesday morning.
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According to his office, the company promises to refund customers if they cancel a trip due to a “covered illness” or “medical condition.” Ferguson said Allianz reimburses clients for physical health conditions — but has rejected insurance claims from those who mention mental health events.
Washington officials reported that Allianz attributed the rejected claims to a “Mental and Nervous Health Disorder” exclusion clause, but the company failed to adequately inform customers on this policy.
Ferguson’s office noted a case from March 2019 in which a Vancouver resident canceled a trip for his 9-year-old son after the boy was diagnosed with bipolar disorder and schizophrenia.
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In another case, officials said an Olympia couple planned to travel to California for their son’s wedding that was ultimately canceled when he experienced a mental health episode and attempted suicide.
The company denied both claims, according to the attorney general.
“Allianz would accept a claim over a broken foot, but not a life-altering mental health diagnosis — that’s not fair, and it’s not lawful,” Ferguson said in a statement. “Mental health conditions are just as real and serious as physical conditions — and both have protection under the law.”
The insurance provider is now expected to pay $800,000 in restitution to the 560 residents affected, as well as $700,000 to the state to help officials distribute the restitution. It will also cover the cost of the investigation and litigation.
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“Moreover, Allianz will be subject to a binding court order preventing it from seeking approval from the Office of the Insurance Commissioner (OIC) to use the discriminatory exclusion for the duration of the consent decree,” the Attorney General’s Office said.
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