Common IDOI Enforcement Pitfalls Dave Rose Chief Investigator
- Slides: 14
Common IDOI Enforcement Pitfalls Dave Rose, Chief Investigator Cathleen Nine-Altevogt, Attorney
Who we are… Enforcement Division • Investigators • Examiners • Attorneys
How we do what we do… Authority: • Producer Statute (Agents) – IC § 27 -1 -15. 6 -12 – Reprimand, levy civil penalty ($10, 000), probation, suspend, revoke or permanently revoke, refuse to issue or renew a license • Unfair Competition/Unfair Claims (Companies) – IC § 27 -4 -1 -4 / § 27 -4 -1 -4. 5 – Penalties: $25, 000/$50, 000, Cease and Desist, Revocation of Certificate of Authority
Administrative Law… • Administrative Law Process – AOPA, IC 4 -21. 5 -3 – Hearings/ALJ • Recommended Order • Final Order – Emergency Orders
Where do our actions come from? • Most Enforcement Actions arise from a failure to disclose a criminal proceeding or an administrative action. – On a license application – After having been licensed
Common Excuses… • “But my secretary filled out my application for me…” – Your application is yours. • “Oh I forgot” • “I didn’t think you really wanted to hear about that. ” • “I didn’t read all of the question”
Important Points To Consider… • Asking forgiveness is not better than asking for permission. • A misstatement on an application is cause for administrative action. • If you can’t read an application for a license properly, how are you going to read an insurance policy properly?
A Bit of Good Advice…. • Pay your taxes • Pay your child support
Some recent issues…. • “Books of Business” – Books of Business do not belong to a producer – Policies belong to the policyholder
More Recent Issues…. • Agents signing documents for customers • It’s Forgery
Even More Issues…. • Agents using Customer Service Reps (CSR’s) to quote policies • Sell, Solicit, Negotiate
Rebating & Referrals • Rebating – Bulletin 177 – Cannot be contingent on a sale – Must be less than $25 in value – Charitable contributions • The Consumer cannot benefit from the “charity” – Reduced Loan Interest Rates/Higher Deposit Interest Rates are also prohibited
Rebating & Referrals • Referral Fees – Commissions must be paid to producers who are licensed and hold the proper lines of authority – Referral fees can be paid to non-licensed people • Cannot be dependent on the sale • The non-licensed person cannot do the selling, soliciting or negotiating
Example Cases • Mc. Gee, rebating • Thornton, cheating • (Smith), misappropriation of clients’ funds
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