Washington Insurance Commissioner Issued Numerous Fines, Disciplinary Actions

Dental Health Services, Seattle; two cases (Fined $100,000; Fined $20,000)

Kreidler imposed part of a suspended fine for failure to comply with the compliance plan it agreed to in November 2018. Kreidler’s office found that the insurer’s individual and small-group rate filings were incorrect and the insurer didn’t comply with the terms of the compliance plan.

Kreidler fined the dental insurer for filing an inaccurate and late financial statement for 2017 and for failing to maintain records to support its financial filings.

Loyal American Life Insurance Co., Cincinnati, Ohio; fined $100,000

The company gave no commission to producers who sold Medicare supplement plans to people over 80 years old, which had the effect of being discriminatory against consumers of that age. The company implemented a commission schedule that was different from the schedule filed in its rate filings.

Symetra Life Insurance Co., West Des Moines, Iowa; fined $80,000

The insurance company offered employer groups a rebate on stop-loss premiums. The stop-loss policies protected employers from large insurance claims and the refunds went directly to the employer. The company did not file the rebate plan with Kreidler’s office for approval and therefore is considered an illegal inducement under state law. From 2015 to 2018, the company paid 41 refunds totaling nearly $1.6 million.

Producers Agriculture Insurance Co., Amarillo, Texas; fined $50,000

Kreidler fined the company for charging rates that were not reviewed or approved by his office. It charged incorrect rates on 1,227 crop-hail policies that resulted in 996 underpayments and 186 overpayments; 45 policies were not affected. The company reimbursed $17,727 in overpayments plus 8% interest. Kreidler suspended $15,000 of the fine as long as the company commits no additional violations for two years.

Florists Mutual Insurance Co., Edwardsville, Ill.; fined $50,000

During a market conduct analysis, Kreidler’s staff found several violations of state law:

The company didn’t use its legal name and domicile on all forms of advertising.

The company advertised its AM Best rating on its website without providing an explanation of the AM Best rating scale.

The company allowed an insurance producer to conduct business in Washington state while their appointment was lapsed. The company also allowed a producer and insurance agency to process 178 insurance transactions in Washington state without being appointed. These transactions totaled $642,240 in premiums and occurred during 2016 and 2017.

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