Washington Collects $630,000 for Insurance Company, Agent Law-Breakers

Washington Insurance Commissioner Mike Kreidler collected just more than $630,000 from insurance companies and agents that did not follow the rules in the last four months of 2008, and he could collect an additional $313,500 in suspended fines, based on future compliance.

“My primary goal is to protect consumers. Making sure insurers play by the rules is vital to accomplishing that goal,” Kreidler said.”The added benefit is that all of the fines we collect are added to the state’s general fund to pay for other state services — particularly important in light of our struggling economy”

Financial Indemnity, Alpha Property and Casualty Insurance were fined $100,000, with $40,000 suspended, for not using the correct company name, allowing unlicensed agents to sell insurance, providing misleading information to consumers and a series of other violations.

Stewart Title had to pay $250,000 of its $400,000 fine — the largest fine issued from August through December 2008 — for giving illegal gifts and incentives to realtors. Details were reported in late-September.

Other significant fines include a $150,000 fine on Sterling Jewelers for not registering with the state to sell service contracts.

Stonebridge Life was fined $100,000, with $65,000 suspended, for selling life insurance policies outside the approved age range.

And CUNA Mutual was fined $40,000 for using unfiled rates, with $20,000 suspended on the condition of no further violations.

Other fines issued and collected during the four-month period include:

* Guardian Life Insurance Company of America – $25,000 for providing insufficient coverage and for not informing consumers about the appeals process.

* Group Health Cooperative – $20,000, with $5,000 suspended, for making claim payments to the wrong party.

* Bentley Motors – $10,000 for not registering to sell service contracts.

* Northland – $10,000 for issuing policies that didn’t match the rates filed.

* National Geographic Society – $3,425 for issuing charitable gift annuities without approval.

* Elderhostel – $2,900 for issuing charitable gift annuities without approval.

* Jerry D. Reder, Jr. – $3,000 for selling a product that had not been approved in Washington.

The Insurance Commissioner’s Office also collected $46,000 from companies that failed to file reports or filed late. These companies face $33,500 in suspended fines if they fail to file properly in the future.

In other enforcement actions, both Medical Savings and Syncora Guarantee had their licenses suspended for not meeting financial requirements. Tatyana N. Chernysheva had her license revoked for not responding to inquiries about her marketing practices. And Robert S. Chronister’s license was revoked for false representation and providing misleading information to consumers.

The Insurance Commissioner’s Office collected a total of $1.2 million in fines in 2008. All of this money was deposited into the state’s general fund.

Source: OIC