Lawsuit: Health Insurance Innovations Hid License Rejection from Investors

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Health Insurance Innovations, Inc., along with its CEO and CFO, has been named as a defendant in a proposed class action lawsuit filed by a man who claims the company failed to disclose material information to stockholders regarding an insurance license application. According to the suit, the defendants hid from investors that the health insurance company’s application for a third-party administrators (TPA) license in Florida had been denied due to “undisclosed legal actions” against certain company insiders. Furthermore, the defendants allegedly failed to warn stockholders that the denial of their Florida application could result in a “domino effect” that would cause the company to lose licenses in several other states.

According to the suit, SeekingAlpha.com published an article on September 11, 2017 about the rejection of the defendant’s license application and caused Health Insurance Innovations’ stock prices to drop 21.91 percent, damaging investors.