May 24, 2018
OLYMPIA, Wash. – Insurance Commissioner Mike Kreidler took enforcement action and issued fines in April 2018 totaling $159,600 against insurance companies, producers and others who violated state insurance regulations.
LifeWise Health Plan of Washington, Mountlake Terrace, Wash.; fined $40,000, order 18-0059
The health insurer’s LifeWise Oregon plan provided inaccurate lists of contracted providers to policyholders and to people shopping for health insurance during open enrollment. The erroneous information caused 133 Washington consumers were overcharged for 206 health insurance claims from January through May 2017 because providers they saw were out of network. The company reimbursed $63,188 to the policyholders who were wrongly charged for seeing out-of-network providers. LifeWise Oregon is no longer being sold.
Sears Protection Co., Hoffman Estates, Ill.; fined $65,000, order 18-0105
Sears illegally sold a tire warranty product called Road Hazard Plus to Washington consumers from 2010-2017. It was not registered to sell stand-alone wheel and tire warranties. It sold more than 53,000 warranties worth $2.3 million. The insurance commissioner ordered the company to cease and desist in September 2017; the company became registered to sell the products in January 2018. The consent order replaces the commissioner’s intent to impose a fine (order 17-0494) and rescinds the commissioner’s cease and desist order (order 17-0311).
Unified Life Insurance Co., Dallas; fined $30,000, order 18-0099
The company allowed 14 unlicensed producers to sell 147 insurance policies. Additionally, it undercharged 48 policyholders and overcharged more than 2,400 policyholders who had short-term medical plans, eventually refunding more than $512,000 to the people it overcharged. The company also failed to respond timely to consumer complaints that were filed with the insurance commissioner.
Unum Life Insurance Co. of America, Portland, Maine; fined $7,000, order 17-0301
The insurance commissioner fined the company for sending letters to 2,146 long-term care policyholders with language that was factually inaccurate. The letter stated that the insurance commissioner initiated a rate increase, when it in fact approved a rate increase that Unum requested.
Charter Oak Fire Insurance Co., Hartford, Conn.; fined $4,000, order 18-0095
The insurance commissioner found the company made 54 violations of state insurance regulations, including using rates that were not approved by the commissioner and using incorrect factors that affected the rates charged. All of the affected policies were for commercial properties.
Manufacturers Alliance Insurance Co., Blue Bell, Penn.; fined $1,000, order 18-0096
The company allowed 74 insurance producers’ appointments to lapse; it allowed three of them to conduct four transactions totaling $3,476 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.
United Fire and Casualty Co., Cedar Rapids, Iowa; fined $1,500, order 18-0154
The company allowed two insurance producers’ appointments to lapse; it allowed one of them to conduct one transaction totaling $12,022 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.
American Modern Home Insurance, Amelia, Ohio; fined $1,000, order 18-0097
During an exam, the insurance commissioner found the company used the incorrect rating factors for eight homeowner and earthquake insurance policies.
Producers, continuing education providers
National Rifle Association (NRA), Fairfax, Va.; ordered to cease and desist, order 18-0109
The NRA solicited insurance in Washington state without an insurance producer license. A consumer filed a complaint that the NRA listed four liability insurance products called Carry Guard on its website, with premiums varying from $155 to $550 per year. The product was only licensed to be sold in Georgia, but the NRA advertised it nationally.
Evelo Electric Bicycles, Seattle, ordered to cease and desist, order 18-0091
Evelo sells electric bikes. It marketed theft insurance with a $500 deductible to customers without being licensed or registered by the insurance commissioner No Washington consumers purchased the insurance and the company has stopped offering the product.
Gregory D. Lone, Wenatchee, Wash.; fined $3,500, order 17-0485
Two consumers filed complaints against Lone, a licensed insurance producer who sold them life insurance policies. Lone sold the first consumer two universal life policies instead of one larger policy, which put the consumer in the position to lose more than $25,000 in earnings and fees. Lone erroneously advised the second consumer that she was allowed to withdraw $50,000 from an annuity as long she repaid the money within 60 days. However, the annuity did not allow repayment, and the consumer lost $3,000 and she incurred a 10 percent IRS penalty.
Terry Easley, Seattle; fined $250, order 18-0017
Easley, a licensed insurance producer, enrolled a consumer in a health insurance policy that she did not financially qualify for. The policy is for low-income individuals and has a low-copay benefit. The consumer filled two prescriptions, thinking her copay would be about $15, but the copay was actually $352. Easley offered to pay for the prescriptions for the consumer because she couldn’t afford the copay; however, doing that is a violation of state law that prohibits insurance producers from giving or offering consumers anything of value as an inducement to buy insurance or to reward them for buying insurance.
Maggie Johns, Woodinville, Wash.; license relinquished, order 18-0021
Johns worked for an insurance agency in an office support position and became a licensed insurance producer in September 2017. The insurance commissioner received a complaint that the agency was using unlicensed producers to sell insurance, and in May 2017 confirmed that Johns was selling insurance without a license, a violation of state law. Johns agreed to relinquish her license to settle the matter and will pay a $500 fine if she decides to pursue a license in the future.
Melissa Forstrom and Melissa Forstrom Agency, Battle Ground, WA; fined $500, order 18-0057
A commercial client needed a policy that contained $1 million in liability coverage for pollution. Forstrom, a licensed insurance producer, issued certificates of liability in 2016 and 2017 showing the requested coverage. However, the insurer who underwrote the commercial policies doesn’t offer the coverage Forstrom sold. The insurer terminated its relationship with Forstrom and her agency and reported the action to the insurance commissioner.
Barbara J. Anderson, Prosser, Wash., fined $500, order 18-0061
A consumer filed a complaint with the insurance commissioner after finding out a homeowner’s policy he purchased from Anderson was not in place because she never submitted the premiums to the insurance company. Anderson refunded the consumer more than $2,000 for the policy.
Joseph R. Costa, Vancouver, Wash., license revoked, order 18-0072
Costa, a licensed insurance producer, was terminated by Farmers Insurance for holding on to more than $1,300 in cash premium payments. He also manipulated his own personal insurance policies to get a better rate and underpaid Farmers $824. His license is revoked and he is no longer allowed to sell insurance in Washington state.
Joshua A. Farris, Puyallup, Wash.; license revoked, order 18-0128
A consumer filed a complaint when she paid Farris for a burial policy that she never received, and she never received a refund. Later, the insurer, Lincoln Heritage, terminated Farris’ appointment for low sales and reported he owed $10,000 in advance commissions on canceled policies. His license is revoked and he is no longer allowed to sell insurance in Washington state.
Melissa L. Bennett, Pasco, Wash., license revoked, order 18-0132
AFLAC reported to the insurance commissioner that Bennett, a licensed insurance producer, collected $150 from three false claims she filed. Bennett later repaid the money to AFLAC. The insurance commissioner has revoked her license and she is no longer allowed to sell insurance in Washington.
Joshua R. Christensen, Fircrest, Wash.; license revoked, order 18-0133
Farmers Insurance notified the insurance commissioner that it terminated Christensen’s appointment when it determined he issued and then canceled 41 commercial insurance policies in order to collect more than $21,000 in commissions. Farmers recovered all but $1,000 of the commissions. Eight of the 10 businesses Christensen wrote policies for had never spoken to him or requested policies from him. The insurance commissioner revoked his license and he is no longer allowed to sell insurance in Washington state.
Fidelity National Title Co. of Washington, Inc., Lynnwood, Wash.; fined $750, order 18-0142
The licensed title insurance agent failed to transfer a title to a consumer who had purchased a home two years prior. The failure to complete the transfer was due to an error on the title agent’s part.
Joyce Millner, Vancouver, Wash.; licensed revoked, order 18-0089
Millner did not submit payment to renew her insurance producer license, which expired in November 2017. The insurance commissioner revoked her license.
Christopher M. West, Vancouver, Wash.; license revoked, order 18-0090
West was issued a probationary insurance producer license in May 2017. He failed to meet the terms of the probationary license, and the insurance commissioner revoked his license.
Gary Sutherland, Framingham, Mass.; fined $250, order 18-0076
Sutherland, a licensed insurance producer, failed to report an administrative action against him by the state of New Jersey within 30 days, as required by state law.
Performance Automotive Management, Inc., Lighthouse Point, Fla.; registration revoked, order 18-0088
The company was registered to sell guaranteed asset protection waivers in Washington state. It failed to report to the insurance commissioner its change of business and mailing addresses in 2013, its home state’s inactivation of its registration in 2016, and its marketer’s inactivated registration. From September 2016 through 2018, every waiver it sold in Washington state was illegal. The insurance commissioner revoked its registration.
Donerio Williams, Phoenix; license revoked, order 18-0100
Williams failed to report within 30 days that the state of Virginia revoked his insurance producer license, as required by state law. He also failed to respond to inquiries from the insurance commissioner. The insurance commissioner revoked his license and he is no longer allowed to sell insurance in Washington.
Nathan Rogerson, Kingwood, Texas; license revoked, order 18-0101
Rogerson failed to report to the insurance commissioner that the state of Minnesota suspended his insurance producer license. He also failed to respond to the insurance commissioner's inquiries. Rogerson’s license was revoked and he is no longer allowed to sell insurance in Washington.
Robert J. Cacioppo, Surprise, Ariz.; license revoked, order 18-0102
Cacioppo failed to report to the insurance commissioner that the state of Indiana revoked his insurance producer license. He also failed to respond to the insurance commissioner. Cacioppo's license is revoked and he is no longer allowed to sell insurance in Washington.
Noel G. Thomas, Palm Bay, Fla.; license revoked, order 18-0103
Thomas failed to report to the insurance commissioner that the state of Indiana denied his insurance producer license. He also failed to respond to the insurance commissioner. Thomas' license is revoked and he is no longer allowed to sell insurance in Washington.
Royalty Insurance Services, Inc., Van Nuys, Calif. Fined $250, order 18-0106
Royalty, a licensed insurance producer, failed to report an administrative action against the agency by the state of Indiana within 30 days, as required by state law.
David A. Judge, Allen, Texas; license revoked, order 18-0107
Judge failed to report to the insurance commissioner that the state of Maine revoked his insurance producer license. The insurance commissioner revoked his license and he is no longer allowed to sell insurance in Washington.
Robert S. Netzel and Patriot Bonding LLC, Scottsdale, Ariz.; license revoked, order 18-0111
Netzel is the designated responsible person for Patriot Bonding. A consumer filed a complaint after paying $640 for a surety bond that was never received, and Patriot refused to issue a refund. Netzel has stopped responding to all inquiries and the consumer never received a refund for the bond.The insurance commissioner revoked both licenses and neither is allowed to sell insurance in Washington.
Great West Casualty Co., South Sioux City, Neb.; fined $900, order 18-0093
The company provides continuing education to licensed insurance producers. From September 2015 through November 2017, it failed to maintain adequate records, and it didn’t adequately monitor or document attendance in its in-person and online courses.
Long Term Care Solutions, Inc., Redmond, Wash.; fined $600, order 18-0140
The company provides continuing education to licensed insurance producers. In 2016 and 2017, it didn’t adequately monitor or document attendance for its in-person and online courses.
Connexion Insurance Solutions, Mountlake Terrace, Wash.; fined $600, order 18-0080
Connexion, a continuing education provider for insurance producers, failed to maintain adequate records and attendance rosters, and failed to issue certificates of completion to attendees.
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 $23 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.