May 23, 2016
OLYMPIA, Wash. – Insurance Commissioner Mike Kreidler issued fines in April totaling $113,600 against insurance companies, agents and brokers who violated state insurance regulations.
For more information, search the order number on the Commissioner’s website.
IDS Property Casualty Insurance Co., De Pere, Wisc.; fined $10,000, order 16-0033
IDS failed to notify the Insurance Commissioner in July 2009 that it was going to start using consumers’ credit scores as one of the factors to determine whether it would insure their homes. Washington state law requires insurers to notify the Insurance Commissioner if credit scores will be considered as a factor when providing insurance. From 2009 through 2015 the company used credit history as a factor more than 70,000 times and declined to offer homeowners policies to 690 applicants.
GuideOne Elite Insurance Co., West Des Moines, Iowa; fined $20,000, order 16-0035
GuideOne Mutual Insurance Co.
GuideOne Specialty Mutual Insurance Co.
The three companies incorrectly applied schedule rating plans and failed to deliver complete policies to consumers within a reasonable time, for a total of 146 violations of state insurance laws and rules. The Insurance Commissioner fined the companies $50,000 with $30,000 suspended if the companies don’t commit additional violations for two years.
Ohio Security Insurance Co., Keene, NH; fined $15,000, order 16-0044
Insurers cannot keep the full premium for a policy after cancellation unless a “fully earned premium” endorsement form is part of the policy and the Insurance Commissioner approves the forms before they are used. Ohio Security tried to keep full premiums on commercial policies after the policyholders canceled them, but did not obtain the Commissioner’s approval for the “fully earned premium” forms, or make them part of the policy. The company refunded more than $8,300 to 98 policyholder, but did not include interest on the refunds.
Unitrin Auto and Home Insurance Co., DeWitt, NY; fined $20,000, order 16-0064
Unitrin allowed 148 licensed producers to sell policies for the company without being appointed for six weeks at the end of 2014. State law requires insurers file a notice and pay a fee to the Insurance Commissioner for each licensed producer that will act as an agent of an insurer. The producers made 1,717 transactions worth $1.9 million in premiums. In addition, the Insurance Commissioner received 23 complaints about the company during 2014, and the company failed to respond to the Insurance Commissioner’s inquiries within 15 days, as required by state law. The Insurance Commissioner fined the company $30,000 with $10,000 suspended provided the company doesn’t commit additional violations for two years.
North River Insurance Co., Morristown, NJ; fined $2,000, order 16-0066
The United States Fire Insurance Co., Wilmington, Del.
State law requires property and casualty insurers to file an annual special liability insurance report with the Insurance Commissioner by May 1 of the following year. The two companies filed their 2014 reports 48 days after the deadline.
Dentegra Insurance Co., Wilmington, Del.; fined $20,000, order 16-0067
Dentegra is a subsidiary of Delta Dental Insurance Co. and sells one individual dental plan in Washington state, the AARP Dental Insurance Plan. The company failed to list its correct legal name on specific documents that were given to the Insurance Commissioner and to consumers. State law requires that companies use their correct legal names on documents.
First American Property & Casualty Insurance Co., Santa Ana, Calif.; fined $4,500, order 16-0072
First American allowed 74 insurance producers to conduct business on its behalf for 50 days without being appointed, involving 3,230 transactions. State law requires insurers file a notice and pay a fee to the Insurance Commissioner for each licensed producer that will act as an agent of an insurer.
California Casualty General Insurance Co., Portland, Ore.; fined $5,000, order 16-0074
California Casualty allowed two insurance producers to issue 307 policies from January until April 2014 without being appointed. State law requires insurers file a notice and pay a fee to the Insurance Commissioner for each licensed producer that will act as an agent of an insurer.
Great Northwest Insurance Co., St. Paul, Minn.; fined $4,500, order 16-0075
Great Northwest allowed five insurance producers to issue 209 policies from May until July 2014 without being appointed. State law requires insurers file a notice and pay a fee to the Insurance Commissioner for each licensed producer that will act as an agent of an insurer.
WFG National Title Insurance Co., Columbia, SC; fined $5,000, order 16-0076
WFG allowed one title insurance agent to issue 915 policies from August until October 2014 without being appointed. State law requires insurers file a notice and pay a fee to the Insurance Commissioner for each licensed producer that will act as an agent of an insurer.
Federated Life Insurance Co., Owatonna, Minn.; fined $2,100, order 16-0077
Federated allowed six insurance producers to issue 14 policies worth nearly $22,000 in written premium from August until September 2014 without being appointed. State law requires insurers file a notice and pay a fee to the Insurance Commissioner for each licensed producer that will act as an agent of an insurer.
Agents and brokers
Pend Oreille Title Co., Newport, WA; fined $2,000, order 15-0294
Title insurance agents and insurance companies are required to submit an annual data report to the Insurance Commissioner. Pend Oreille Title failed to submit its reports for 2013 and 2014, despite repeated attempts to contact them and remind them of the reporting requirement. The Insurance Commissioner fined the company $5,000 with $3,000 suspended as long as the company doesn’t commit any violations for two years.
Willoughby McIntosh, Portland, Ore.; fined $3,000, order 16-0009
McIntosh is not licensed to sell insurance products in Washington state and sold two annuities to a Washington consumer. The annuities were not approved for sale in Washington state, and McIntosh gave the consumer false information that the annuities would earn 8 percent interest per year and provide a lifetime income stream.
Marc A. Perez, Puyallup; fined $250, order 16-0019
One of Perez’ clients purchased a contractor’s bond and insurance policy for $505. Perez forgot to submit the money to the insurance company, and the contractor’s bond and policy were canceled. State law does not allow insurance producers to hold onto premium payments from consumers; they must be submitted to the insurance company promptly.
BJK Inc., dba Gray’s Insurance Team, Colorado Springs, Colo.; license revoked, order 16-0080
Maureen Gray, Colorado Springs, Colo.
Gray and her agency failed to forward more than $334,000 in policyholders’ premium payments to the insurance company, Philadelphia Indemnity Insurance Company. The company had canceled the policies, but reinstated them when it determined that the policyholders’ payments were being held by Gray and her business.
Oleg Derlyuk, Vancouver, Wash.; fined $250, order 16-0082
The Insurance Commissioner revoked Derlyuk’s insurance producer license in March 2016 for failure to respond to an inquiry about the status of his license. Derlyuk contacted the Insurance Commissioner with the information requested and agreed to pay a $250 fine to reinstate his license.
Bejay Barber, Matthews, NC; order to cease and desist, order 16-0106
Sunway Insurance, fka Federal Assurance
Barber is not licensed to sell insurance in Washington state, as his license expired in November 2015. He is barred from renewing his license pending the outcome of a felony embezzlement charge against him. The Insurance Commissioner found that Barber and his business, Sunway Insurance, were soliciting business on Seattle Craigslist, a violation of state insurance law. Sunway’s website also markets quote requests to Washington consumers, another violation.
About the Office
Kreidler’s office oversees Washington’s insurance industry to ensure that companies, agents and brokers follow state laws. Since 2001, Kreidler's office has assessed $20.2 million in fines, which are deposited in the state's general fund to pay for other state services.
For an insurance question or complaint, contact the Insurance Commissioner’s consumer advocates online or by phone at 800-562-6900.
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