An insurance brokerage based in Burlington recently agreed to pay a group of Iowa cities, counties and school districts over a million dollars to cover what the state insurance commissioner has classified as “deceptive” fees. But SOME local officials say they’re getting just a fraction of what they SHOULD be paid and they’d like to sue. Two Rivers Insurance has agreed to pay restitution to Winnebago County, for example, but County Supervisor Mike Stensrud, of Lake Mills, says the county actually overpaid Two Rivers by far, far more.

“I can definitively say that I will not go along with accepting the $5700 settlement,” Stensrud says. “I believe we can prove that we were bilked out of $85,000.” Stensrud is urging his fellow county supervisors to sue. “I believe that we should go after the loss that we incurred,” Stensrud says. Hancock County Supervisor Jerry Tlach, of Garner, says Hancock County paid the company more than 250-thousand dollars in brokerage fees that were disguised as premium costs, but Two Rivers has agreed to cut the county a check for just a quarter of that amount.

“We haven’t signed anything to say we’ll accept it yet or not,” Tlach says. “…This is the best deal the Iowa Insurance Division thought they could come up with.” Two Rivers Insurance sold Wellmark Blue Cross Blue Shield health insurance policies to local Iowa governments for more than 10-thousand employees statewide. In 2014, Wellmark informed regulators it had discovered Two Rivers was adding fees to what was described to customers as just the premiums.

Two Rivers denies wrongdoing, but in May the company agreed to pay the local goverments one-point-three million dollars. The president of Two Rivers told The Des Moines Register the brokerage still believes its “past practices were appropriate at the time,” but agreed to offer to pay restitution to end “what would be an extremely costly and burdensome legal process.” The settlement involves 15 counties, 12 Iowa cities and four school districts as well as the public library and public water utility in Council Bluffs.

These local governments formed a consortium to buy policies in a larger group. Many local officials involved have indicated they’ll accept the Two Rivers restititution because their counties, cities and schools were able to reduce insurance costs with lower group rates. The 33 local governments have until July 22nd to accept or reject the proposed restitution. Locally, the settlement involves the CITIES of Council Bluffs and Harlan, and the following COUNTIES: Guthrie, Monona, Pottawattamie and Union.

Here is a link to the insurance commissioner’s ruling and “Exhibit A” spells out how much Two Rivers is to pay to each of the local governments listed above.

(Radio Iowa)