Dave and Darlene Henderson bought Mega Life health insurance through the National Association of Self-Employed (NASE). For $400 a month, the couple said, the Mega Life agent told them that they could have a catastrophic group health insurance policy that would cover 80 percent to 100 percent of their hospital costs up to $1 million.

In 2001, Darlene Henderson became ill with breast cancer. David was later felled by an aortic aneurysm the size of a baseball and needed emergency surgery.Those medical misfortunes left the Hendersons with more than $210,000 in medical and hospital bills. Mega Life covered $33,428 of the Hendersons' bills. The couple were left stunned and quivering when they learned they still owed more than $180,000.

The Hendersons asserted their agent didn't emphasize or explain critical information:

1. There was no cap on their out-of-pocket expenses with Mega Life, unlike traditional health insurance, and
2. Their benefits had daily maximums far below the average cost of modern-day medical procedures and hospital stays.

A Nevada County Superior Court judge has dismissed a lawsuit filed by the Hendersons. Judge Albert P. Dover rejected the claims, saying they received exactly the benefits they signed up for when they bought a policy from Mega Life and Health Insurance Co.. Dover suggested consumers must read the fine print before they buy any insurance policies.

The California Foundation of Taxpayer and Consumer Rights has denounced Mega Life policies as "skeletal." The group said Mega Life's policies are so technical and riddled with jargon that the Hendersons were unlikely to have understood its limits if they had read it.

For more on NASE and Mega Life check out The Rip Off Report