Occasionally, two insurance plans work together to pay claims for the same person. That process is called coordination of benefits. Insurance companies coordinate benefits to avoid duplicate payments by making sure the two plans don’t pay more than the total amount of the claim. They may also need to establish which plan is primary and which plan is secondary—the plan that pays first and the plan that pays any remaining balance after your share of the costs is deducted.
The carriers will periodically send out letters to the insured, to check on “other insurance coverage”, especially if certain claims appear to be part of an accident, such as a broken leg, hip injury, etc. If the insured ignores the letter, eventually the claims will be pended, and not processed. Eventually, these claims may be sent to a collection agency, and it may take several months, or even a year before the insured receives the collection notice.
Since it can be difficult to get the claims processed and paid after that amount of time, we strongly recommend that insureds answer these letters or questionnaires as soon as they are received. Many times, the insurance company will take the information right over the phone. Once they know there is no other insurance coverage on the claim, the claim can be quickly processed and paid.