Merrideth Tidwell, a former manager for UICI in Sarasota, Fla., says her superiors taught agents to withhold information about coverage limits from prospective customers. Ms. Tidwell, a top producing agent, according to a UICI internal newsletter, says she was instructed by managers to tear out a page from a brochure that explains coverage limits, or to not give brochures to customers.

The brochure, for example, explains that on UICI's Freedom 300 plan the insurer pays 100% "up to $300 per day" for hospital room and board, "up to $900 per day" for intensive care and that an 80% payment of miscellaneous in-hospital charges is capped at a "maximum of $18,000."

Rather than share that information, Ms. Tidwell says her managers created their own sales sheet for agents by photocopying the "plan benefit" page and adding 100% or 80% along the-right hand side, leaving out the maximums. This sales sheet makes it appear that the policies would pay 100% of hospital room and board, intensive care, an anesthesiologist's charges and some other surgical expenses on an unlimited basis. Four other UICI agents say they also were told to use the sheets in their sales presentations.

"They are training agents to trick the consumer," says Ms. Tidwell, 27.

When Mr. Bloedel underwent open-heart surgery a year later, the policy paid about $29,000 toward the surgery and a weeklong hospital stay. That left the Bloedels to pay $45,000 out of their retirement savings. The Bloedels likely would have paid far less under their previous Mutual of Omaha Insurance Co. policy, which had a $5,000 deductible. "I'm afraid we made a really stupid decision," says Mrs. Bloedel. "We trusted what the insurance salesman was saying. Insurance is like a foreign language to us."  Jameshoyer.com