July 20, 2017
OLYMPIA, Wash. – Insurance Commissioner Mike Kreidler disciplined and issued fines in June totaling $109,350 against insurance companies, agents and other professionals who violated state insurance regulations.
Delta Dental of Washington, Seattle; fined $20,000, order 17-0140
The company overcharged 765 Washington consumers for their copayment for anesthesia. It identified 800 overcharges totaling $132,800. It refunded all of the overcharges plus 8 percent simple interest of $19,649.
Delta Dental of Washington, Seattle; fined $250, order 17-0112
The company provides continuing education for licensed insurance producers. Insurance producers are required to obtain continuing education in order to renew their licenses. During some of Delta Dental’s continuing education courses, it failed to verify licensed producers attended the entire presentation and signed the attendance register at the beginning and end of the presentation; and submitted a roster for a person who did not complete the course.
UnitedHealthcare of Washington, Inc., Seattle; fined $10,000, order 17-0028
A medical provider complained to the insurance commissioner that UnitedHealthcare did not respond to an expedited appeal for a consumer’s medical treatment within 72 hours of receipt, as required by state law. Expedited appeals are required for patients for whom the decisions “could seriously jeopardize the enrollee’s life, health or ability to regain maximum function.” The commissioner asked the company to review its expedited appeals for the past two years to determine if any others failed to meet the 72-hour turnaround time. The company identified 59 expedited appeals that were not processed within the required time from April 2014 through April 2016.
UnitedHealthcare of Washington, Inc., Seattle; fined $2,000, order 17-0067
UnitedHealthcare used incorrect business names on some of the forms that it sent to consumers, payments to medical providers, other correspondence and its website.
Western United Life Assurance Co., Spokane; fined $4,500, order 17-0107
Western United Life Assurance Co. allowed 371 insurance producers’ appointments to lapse; 24 of the producers conducted 26 transactions totaling more than $1.9 million in premiums. State law requires insurers to file a notice and pay a fee to the insurance commissioner for each licensed producer who will act as an agent of an insurer.
Brown & Brown of Washington, Inc., Seattle; fined $500, order 17-0062
Brown & Brown is a licensed insurance producer. A small-business client complained to the insurance commissioner that Brown & Brown provided misleading information about a health insurance plan for the client’s employees. The misinformation was a result of the producer trying to simplify the wording in the policy about deductibles and out-of-pocket maximums. While the misinformation was not intentional, it resulted in a policyholder having to pay more out of pocket than expected.
Federal Insurance Co., Indianapolis; fined $30,000, order 17-0103
Federal Insurance Co., a subsidiary of Chubb Insurance, sold rental car insurance policies to Washington consumers that were not filed with or approved by the insurance commissioner, a violation of state law. The company sold 701 policies totaling more than $18,436 in premiums from November 2013 until December 2015. The company stopped selling the policies in Washington state in December 2015.
Plaza Insurance Co., West Des Moines, Iowa; fined $4,000, order 17-0095
Plaza Insurance Co. allowed 13 insurance producers’ appointments to lapse. Of that number, three producers conducted seven transactions totaling more than $254,000 in premiums. State law requires insurers to file a notice and pay a fee to the insurance commissioner for each licensed producer who will act as an agent of an insurer.
Pioneer Specialty Insurance Co. and National Assurance Co., Edina, Minn.; fined $10,000, order 17-0110
The companies discovered and reported to the insurance commissioner an error involving their rates that resulted in some consumers being overcharged and some being undercharged. From January 2014 through April 2016, 550 policies were overcharged a total of $30,807 and 729 policies were undercharged a total of $207,063. The companies refunded all overcharges plus 8 percent simple interest.
ACGS Marine Insurance Co., Chicago; fined $5,000, order 17-0135
The company allowed 171 insurance producers’ appointments to lapse. Of that number, 40 producers conducted 104 transactions totaling more than $593,000 in premiums. State law requires insurers to file a notice and pay a fee to the insurance commissioner for each licensed producer who will act as an agent of an insurer.
Furthermore, two insurance producers sold policies without being appointed by the company. State law requires insurers to file a notice and pay a fee to the insurance commissioner for each licensed producer that will act as an agent of an insurer.
WellCare Prescription Insurance, Tampa, Fla.; fined $1,000, order 17-0108
The company allowed 143 insurance producers’ appointments to lapse. Of that number, five producers conducted five transactions totaling $690 in premiums. State law requires insurers to file a notice and pay a fee to the insurance commissioner for each licensed producer who will act as an agent of an insurer.
Garrison Property and Casualty Insurance Co., USAA Automobile Association, USAA Casualty Insurance Co., and USAA General Indemnity Co., San Antonio, Texas; fined $12,000; order 17-0139
Washington state law allows, but does not require, insurance companies to use consumers’ credit scores when calculating insurance property and casualty premiums, and sets standards for making sure credit scores are applied fairly to all Washington consumers. The insurance companies chose to use consumers’ credit scores as one factor in setting rates. However, the companies did not file rating rules for extraordinary life circumstances exceptions, which allows the companies to make exceptions for people in hardship. The companies were granting the exceptions without the insurance commissioner’s review of the exceptions, a violation of state insurance laws.
Hillary M. Peil, Spokane; fined $1,000, order 17-0054
Michael A. Peil, Liberty Lake; fined $1,000, order 17-0055
Shon Peil, Spokane; fined $2,000, order 17-0076
A consumer complaint revealed that Hillary and Michael Peil wrote annuities without ever meeting with the clients. A third producer, Shon Peil (the husband of Hillary Peil) would meet with clients and then Hillary Peil and Michael Peil would write the policies. Shon Peil was not appointed with the company for which he was selling annuities, a violation of state insurance regulations. Hillary Peil indicated on nine policies that she was the signing producer, when she was not. Michael Peil indicated on seven policies that he was the signing producer, when he was not.
Edgar Espinosa, Spanaway; fined $250, order 17-0066
Edgar Espinosa applied for an insurance producer license in March 2017 and failed to disclose a misdemeanor conviction from 2010, a violation of state insurance law.
AnnMarie Sweeney, Federal Way; fined $250, order 17-0120
A consumer asked AnnMarie Sweeney, an insurance producer, to cancel a policy. In an email response to the consumer, Sweeney said, “You are going from the best insurance companies to one of the worst.” Insurance producers are prohibited in state law from disparaging other producers or companies.
David Thomas Shoults, Wenatchee; fined $3,000, order 17-0142
David Shoults is a licensed insurance producer. He allowed an employee who was not a licensed insurance producer to sell up to 15 policies and provide quotes to two consumers. Shoults also did not obtain licenses for his offices in Kennewick, Spokane, East Wenatchee and Wenatchee.
Andrew J. Cross, Olympia; fined $1,000, order 17-0143
Andrew Cross, a licensed insurance producer, issued an insurance policy to a consumer without her knowledge. The consumer complained to the insurance commissioner after she canceled all of her policies with Cross. An investigation revealed that 105 of Cross’ clients who had Progressive Insurance were issued Safeco policies without their knowledge or consent.
Patricia Anne Santamaria formerly Lambert, Oregon City, Ore.; revocation rescinded and fined $500, order 17-0169
Patricia Santamaria, originally licensed as Patricia Lambert, was a licensed insurance producer until 2013, when her license was revoked for failure to respond to the insurance commissioner’s inquiries about her license renewal fee being rejected. Santamaria contacted the insurance commissioner in May 2017, seeking to have her license reinstated. She agreed to pay the appropriate licensing fee and a fine.
NAIFA Portland NW Oregon, Salem; fined $600, order 17-0130
NAIFA is a continuing insurance education provider that offered six classes that expired in January 2017 to 28 insurance producers. The insurance commissioner gives continuing-education providers notice twice – 60 days and 10 days – before a course expires.
Heidi E. Manivong, St. Petersburg, Fla.; fined $500, order 17-0141
Heidi Manivong applied for an insurance producer license and two license renewals without disclosing a felony conviction.
About the Office
Kreidler’s office oversees Washington’s insurance industry to ensure that companies, agents and brokers follow state laws. Since 2001, Kreidler has assessed more than $22 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 Kreidler’s consumer advocates online or by phone at 800-562-6900.