Score ONE for Insurance Regs

Score ONE for the insurance industry and the Florida Office of Insurance Regulation; ZERO for the bad guys.

After a long and elaborate investigation conducted by OIR, a long and what seemed to be a never-ending saga finally came to an end in Florida in late March when Sirius International Insurance Corp. withdrew the application it submitted to OIR for approval to do business in Florida as an eligible surplus lines insurer (see story page 10).

Sirius is part of a national and international conglomerate, which includes White Mountain Re, and the International Medical Group.

OIR had been receiving numerous complaints about agents representing Sirius for a long time and was finally able to pressure the company to cease its operations in Florida.

According to OIR and other complainants, Sirius had been underwriting medical plans in violation of a voluntary cease and desist, and a consent order and repeatedly breaking a number of Florida Statues. IMG received a letter of denial, and three days later Sirius and White Mountains representatives and attorneys met with OIR in Tallahassee. Sirius opted to withdraw their application.

IMG managed and administered the major medical plans; MHG marketed and facilitated them, and Sirius provided the underwriting paper.

Many readers, especially Jon Bond, have been feeding me complaints about Sirius, IMG and White Mountain Re for a long time, but there was nothing I could print until the OIR took action.

Last year, after receiving a mountain of e-mails on this topic, I attended a Florida meeting in which Bureau of Licensing Chief Hazel C. Muhammed was the speaker. At that time I told her about the complaints I had been receiving and asked if she knew about the them and was investigating. She responded that she knew about them, but due to an on-going investigation, she couldn’t tell me anything.

As an investigative reporter, I often find myself caught in the middle of such cases. Although readers complain to me about such a company, and allege illegal activities, there is really very little I can publish until the authorities crack down and establish their cases, which, as in this instance, can take a very long time.

As Muhammed and I discussed at the time, legitimate businesses become licensed, while illegitimate operators ignore state requirements and simply operate illegally, sometime utilizing legitimate agents, raking in millions and even if the OIR knows about them, it takes months and months to gather enough evidence to serve them notice.

While the OIR scored a point and put a bad-guy out of business, Insurance Journal readers should realize there are still a lot of other bad-guys out there, some operating with licenses, some without. Before you agree to represent any carrier and sell its products, check the company out carefully. Check with the OIR to make sure it is fully licensed. Avoid agreeing to represent a company that might be a bad-guy and end up making your agencies activities also appear questionable.