However, only 8 percent of adults surveyed said they have contacted their state insurance department to confirm the validity of an insurance provider before making a purchase.

As part of the U.S. fight against the rise in fake insurance, the NAIC launched a nationwide awareness campaign that encourages consumers to "Stop. Call. Confirm," before buying insurance.

"In the area of fake health insurance alone, the U.S. General Accounting Office reported 144 fake health insurers nationwide sold bogus products to more than 200,000 policyholders between 2000 and 2002," said Diane Koken, NAIC president and commissioner of Pennsylvania. "This is simply unacceptable."

Under most state laws, with very few exceptions, no insurance can be sold by individual agents, brokers or companies without the approval of the state insurance department, NAIC noted.

A key problem in catching operators of health insurance scams, according to Texas Commissioner Jose Montemayor, is that many plans manage to avoid state officials by claiming to be exempt under the Federal Retirement Security Act.

The GAO report stated that at least 15,000 employers, including many small companies, purchased coverage from unauthorized entities. The states reported that more than half of the organizations they identified frequently targeted their health benefits to small employers.

Ms. Koken noted that fake insurance is attractive because it is typically less expensive than legal policies.

"But that is because a fake policy does not provide sufficient?if any?coverage," she said.

At a U.S. Senate Finance Committee hearing earlier this year, U.S. Senator Charles Grassley (R-Iowa) said "there is no consistent, national comprehensive strategy for systemic nationwide problems."

Also at the hearing, Florida resident Joan Piantadosi said that her husband nearly did not get a liver transplant when it became clear their insurance was fake.