Minnesota Fines Agency for Advertisement Exploiting AIG Situation

The Minnesota Department of Commerce has taken action against a Duluth insurance agent and agency for publishing a newspaper advertisement that solicited business from current policyholders of American International Group (AIG) insurers by questioning the financial health of the AIG parent company.

The department has repeatedly affirmed the financial solvency of AIG’s insurance companies, despite the troubles associated with the parent company.

Gregory Brisky, a licensed insurance agent working for the Dwight Swanstrom Co. of Duluth, agreed to pay a $2,000 fine for placing the advertisement. The Swanstrom agency agreed to a $3,000 fine.

The Dwight Swanstroom Co. and Brisky agreed to an informal deposition on the matter and waived the right to a hearing.

Officials alleged that Brisky and the Swanstrom agency did not take any action to verify the financial condition of any specific AIG insurance company before placing the advertisement and attempted to induce AIG policyholders to replace their insurance. It is against Minnesota law to make any misleading representation as to the financial condition of any insurer.

The Swanstrom Agency ad said: “AIG policyholders, nervous about the current situation with your insurance company? We have alternatives. Don’t be risky, insure with Brisky.”

“These enforcement actions give us another opportunity to assure Minnesota consumers that AIG’s insurance companies, regulated by the states, are solvent and financially strong,” said Insurance Commissioner Glenn Wilson. “If someone tells you to replace any policy because an AIG insurance company is in trouble and may not be able to pay your claim, that is not only untrue, it could be against the law, and we will take action like we did today.”

Officials also said the state commerce department is investigating several other potential violations of the law relating to the misrepresentation of insurance and annuity products because of the turbulent economic times.

Source: Minnesota Department of Commerce

Latest Comments

• October 24, 2008 at 1:09 am

  John Q Agent says:

  OK Mr. NAIC smarty pants. Tell me what happens when the Feds, who now have AIG Life assets pledged as collateral, have to call the loan? These are differnet times, when the g... read more
• October 24, 2008 at 12:19 pm

  AZInsMan says:

  NEVER even insinuate negativity about the financial condition of an insurer. That is a law in almost every state. So, if the ad had been worded to just say: "Are you insured w... read more
• October 23, 2008 at 5:03 am

  RS says:

  Thank you for the response NAIC. That makes a lot of sense but that doesn't always apply in insurance!