The Defense Department, the National Association of Insurance Commissioners, and state insurance regulatory agencies need to work more closely to stop predatory sales practices by unscrupulous brokers that target service members, according to a May 29 report by the Government Accountability Office. Since Congress passed a law in 2006 aimed at tightening scrutiny of such practices, the GAO states, DoD, the NAIC, and state governments have taken steps to bring miscreants to justice. But some problems persist. For instance, the GAO report stated, DoD is reluctant to share information with the NAIC – an entity over which it has no control. As a result, the report stated, “Some sales of insurance products that new state regulations generally presume to be unsuitable for service members appear to be continuing.” The GAO also would like DoD to examine more closely the use of MyPay, the department’s automated pay system, to determine if service members are using it to pay insurance allotments. Such payments are forbidden by the DoD and in many states.
