Washington Commissioner Disciplines Producers for Violations

June 10, 2014

Insurance Commissioner Mike Kreidler issued fines to several insurance companies, agents and brokers who violated state insurance regulations during May.

The fines totaled $12,250. They are:

Insurance companies

Benefit Marketing Solutions and Benefit Services Association, Norman, Okla. Kreidler ordered the company, which is not licensed in Washington, to cease and desist selling service contracts to Washington consumers.

North Coast Life Insurance Co., Spokane. North Coast, a life and disability insurance company, is required under state law to file quarterly financial statements to the commissioner to show the company is financially solvent. The company failed to submit a signed statement verifying the validity of the statements for three quarters. The company was fined $3,250.

Washington Insurance Commissioner Mike Kreidler

Washington Insurance Commissioner Mike Kreidler

Oblate Annuity Trust, Washington, D.C. Oblate is a charitable organization, which is required to obtain a certificate of exemption from the commissioner before it is allowed to issue charitable gift annuities, which offer a lifetime stream of income in exchange for a large charitable donation. Charitable organizations must file for a certificate of exemption because the types of annuities they provide are governed by a different state law than for-profit annuities. Oblate issued 59 charitable gift annuities before it applied for an exemption in 2011. Its application is still pending.  The company was fined $7,500.

Partners in Health Care Inc., Appleton, Wis. Partners in Health Care sold discount medical plan cards on behalf of another company, neither of which is licensed to sell insurance products in Washington. PIHC refunded the cards’ purchase price to 39 Washington consumers and agreed to notify other consumers who purchased the cards that they have a right to cancel their cards and receive a refund.

Universal Home Services, Inc. and Universal Administrators Services, Inc., Louisville, Ky. The company issued home warranty service contracts to Washington consumers without a license and used another licensed insurance company’s name as the guarantor without its knowledge or consent. A cease and desist order was issued.
Agents and brokers

Xavier T. Lawson-Kennedy, Richardson and Desoto, Texas; Lawson-Kennedy’s failed to comply with the terms of his probationary license and failed to respond to an inquiry from the Insurance Commissioner. His probationary license required him to report repayment of child support debt and to respond to requests for documentation. Their license was revoked.

Stephen L. Nims; Kensington, Conn.; Nims previously sold insurance to a Washington business using his employers’ Washington nonresident producer license. Nims then went into business for himself and continued to use his former employer’s Washington license, which is against the law. Nims has since obtained his own nonresident producer license.  Nims was fined $500.

Moses Torres, Hurst, Texas. Torres surrendered his license in Texas after three misdemeanor convictions. He was required to report these convictions to the Washington insurance commissioner, where he held a nonresident producer license, but failed to do so. Washington and six other states have revoked his license or fined him.

Walter W. Wolf, Spokane Valley. Wolf acted as a surety insurer in Washington without a certificate of authority. He solicited and sold insurance on behalf of an unauthorized insurer and was not licensed as a surplus lines broker. Wolf was fined $1,000.

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