We care about Aflac’s policyholders affected by recent weather:
To help provide relief for Indiana policyholders residing in Delaware, Jefferson, and Randolph counties affected by the recent tornadoes, Aflac will provide a premium grace period starting March 13, 2024, and ending May 13, 2024. This grace period also provides an extension of filing deadlines for claims and leniency for any other action required under the policy. Aflac will provide a replacement copy of the policy upon request by the policyholder.
We care about Aflac’s policyholders affected by recent weather:
To help provide relief for California policyholders residing in Alameda, Butte, Glenn, Lake, Mendocino, Monterey, Sacramento, San Francisco, Santa Cruz, Sonoma, and Sutter Counties affected by the winter storms, Aflac will provide a premium grace period starting Feb. 3, 2024, and ending May 21, 2024. This grace period also provides an extension of filing deadlines for claims and leniency for any other action required under the policy. Aflac will provide a replacement copy of the policy upon request by the policyholder.
On Feb. 21, 2024, the cyber event reported by Change Healthcare, a company that assists healthcare providers with claims submissions and payments, has created a significant impact to health care providers, including hospitals, individual practitioners, practice groups, diagnostic centers, laboratories, and pharmacies. We have determined Aflac’s primary operations are not impacted. Further, Aflac and its subsidiaries do not have any direct connection to Change Healthcare systems in any of Aflac’s systems or applications. At this time, we are not aware of any impact to customer data but we are monitoring for any communications from our critical third-party suppliers. While Change Healthcare’s cyber event was not directed at Aflac, we will provide flexibility with claims submissions related to this incident should it be needed. If you believe you have a claim impacted by Change Healthcare’s event, please contact Aflac at 800-992-3522.
We care about Aflac’s policyholders affected by recent weather:
To help provide relief for California policyholders residing in Los Angeles, Orange, Riverside, San Bernardino, San Diego, San Luis Obispo, Santa Barbara, and Ventura Counties affected by the winter storms, Aflac will provide a premium grace period starting Feb. 3, 2024, and ending May 21, 2024. This grace period also provides an extension of filing deadlines for claims and leniency for any other action required under the policy. Aflac will provide a replacement copy of the policy upon request by the policyholder.
Aflac Japan announced today that it has reported its findings of an internal review of paid claims to Japan's Financial Services Agency (FSA). The company conducted the review of its claims payment practices over the past five years in compliance with an industrywide order issued by the FSA on February 1, 2007.
Commenting on the results of the claims review, Aflac Japan President and Chief Operating Officer Akitoshi Kan said: "We have always worked very hard to ensure we pay our customers accurately and promptly. Unfortunately, in the process of this claims review, we found some cases in which we made mistakes and did not fully pay the claims that our policyholders were entitled to receive. We sincerely apologize to those customers who were affected by this oversight, as well as to all other relevant parties.
"We have been contacting customers, offering our apology, and paying the additional benefits. We have already completed this process for approximately 80% of all those who deserve additional payments, and we are working hard to contact the remaining customers so we can finish making the additional payments as quickly as possible. In addition, we are taking thorough preventive measures to make sure these mistakes do not happen again. As a company, we will do our best to regain the trust and confidence of our customers."
1. Findings of the review
Aflac Japan analyzed all paid claims for a five-year period from April
2001 through March 2006 to determine if there was a need to make
additional payments, including cases where customers may have qualified
for benefits for which they did not file a claim. The company reviewed
a total of approximately 4.23 million benefit payments to 1.52 million
claimants.
As a result of the review, the company found a total of 19,169 errors,
or .45% of total benefit payments made over the last five years. The
total amount of the additional payment for these claims is
approximately ¥1.9 billion. Of that amount, ¥1.0 billion was provided
for in the 2006 financial statements of Aflac Incorporated and
Subsidiaries.
As part of Aflac Japan's day-to-day payment operations, the company has
had a process in place for notifying customers of any other benefits
they may have been qualified to receive for which they did not actually
file a claim. However, in the process of the claims review, the
company found 621 claimants who may qualify for additional benefits.
For this group of claimants, Aflac Japan will be contacting them
promptly to determine if additional benefit payments are required. The
company expects to complete this process by May 31.
Number of Claims Requiring Additional Payment
Ratio of Total
Underpaid
Underpaid Underpaid Underpaid Total Total Benefits
Fiscal Death Health Other Underpaid Benefits to Total
Year Benefits Benefits Benefits Benefits Paid Benefits Paid
2001 4 2,747 25 2,776 675,744 0.41 %
2002 16 3,295 22 3,333 751,736 0.44 %
2003 28 4,776 32 4,836 850,370 0.57 %
2004 29 4,795 38 4,862 929,507 0.52 %
2005 21 3,293 48 3,362 1,026,020 0.33 %
Total 98 18,906 165 19,169 4,233,377 0.45 %
2. Causes of payment errors
The primary cause for these mistakes was human error in the course of
claims payment operations, including mistakes in data entry and
overlooking of some items on the medical certificate and claim
application forms. The company believes its employees' knowledge and
skills did not keep pace with the increasing number of claims that
occurred and the advances in medical treatments. Errors also arose
because of employees' unfamiliarity with a new claims payment IT system
that was implemented in 2003 to respond to an increasing number of
claims payments. In addition, the company determined it had
insufficient procedures to identify human error prior to making a
claims payment. However, as Aflac Japan strengthened data entry
verification procedures and as employee skills improved due to
education and training, the company experienced a significant decline
in the error rate in fiscal year 2005, as indicated in the table above.
3. Preventive measures
Aflac Japan has been taking measures on an ongoing basis to increase
the quality of its claims payment operations, including increasing the
accuracy of payments by deploying new systems, appropriately allocating
human resources and implementing training programs. Based on an
analysis of the causes of the claims processing errors referenced
above, the company will use the following measures to help prevent
these types of claims errors from recurring.
1) Strengthen education and training programs regarding claims payments
Aflac Japan is forming a dedicated team in charge of education and
training within the Claims Department. This team will be
responsible for conducting systematic training programs that include
developing a wider range of more advanced and necessary claims
payment knowledge and skills. The company will also implement
special training programs that are designed to educate employees on
up-to-date medical treatments and information based on input from
physicians.
2) Increase the number of employees in the Claims Department
Aflac Japan will increase the number of employees in the Claims
Department from 450 to 550 over the next three years in addition to
further strengthening the verification process for data entry
operations.
3) Modify the format of medical certificates
Aflac Japan has modified its medical certificate to make it easier
for physicians to complete and for employees to read. Changes to the
certificate are expected to help ensure that information, such as
the name of a surgery, will be entered in the correct column.
4) Strengthen review functions
Aflac Japan is establishing a Payment Review Section within the
Claims Department to assess and monitor claims payment processes by
using the verification system that was developed to conduct the
recently completed claims review. An audit mechanism, called the
Payment Audit Group, was also established within the Internal Audit
Department. This group is staffed with employees who have
significant claims payment experience.
5) Centralize data entry operations
Aflac Japan will establish a data entry center that will combine
seven locations around Japan into one centralized location. This
should help to further improve employees' skills on a consistent
basis.
6) Establish a Customer Payment Inquiry Section and advisory panel
Aflac Japan has established a Customer Payment Inquiry Section.
This new section is separate from the Claims Department and provides
an exclusive avenue for customers to discuss and/or confirm claims
payments. In addition, the company will form an advisory panel to
check payment practices and independently review any complaints
and/or requests from customers about their payments.
For more than 50 years, Aflac products have given policyholders the opportunity to direct cash where it is needed most when a life-interrupting medical event causes financial challenges. Aflac is the number one provider of guaranteed-renewable insurance in the United States and the number one insurance company in terms of individual insurance policies in force in Japan. Our insurance products provide protection to more than 40 million people worldwide. Aflac has been included in Fortune magazine's listing of America's Most Admired Companies for seven consecutive years and in Fortune magazine's list of the 100 Best Companies to Work For in America for nine consecutive years. Aflac has also been recognized three times by both Fortune magazine's listing of the Top 50 Employers for Minorities and Working Mother magazine's listing of the 100 Best Companies for Working Mothers. Aflac Incorporated is a Fortune 500 company listed on the New York Stock Exchange under the symbol AFL. To find out more about Aflac, visit aflac.com.
(Logo: http://www.newscom.com/cgi-bin/prnh/20041202/CLTH019LOGO )
Analyst and investor contact - Kenneth S. Janke Jr., 800.235.2667 - option 3, FAX: 706.324.6330, or
Media contact - Laura Kane, 706.596.3493, FAX: 706.320.2288, or
First Call Analyst:
FCMN Contact: bbarfield@aflac.com
SOURCE: Aflac
CONTACT: Analysts and investors, Kenneth S. Janke Jr., +1-800-235-2667,
option 3, fax, +1-706-324-6330,
+1-706-596-3493, fax, +1-706-320-2288,
Web site: http://www.aflac.com/
