The Missouri Department of Insurance announced a regulatory agreement with American Modern Insurance Group Inc. over allegations that the company charged excessive rates in lender placed homeowners policies.
Missouri regulators participated in a multistate market conduct action of American Modern in collaboration with regulators in Ohio, Indiana and Washington.
In the settlement, American Modern agrees to pay $6 million in penalties and establish a $20.3 million restitution pool.
“This insurer was facing allegations of charging excessive rates for lender placed policies to homeowners” said Department Director John M. Huff. “Our team was able to collaborate on a settlement with multiple states to benefit Missourians.”
As part of the settlement agreement, American Modern will bring its rates into conformance with previously approved rates. It will also review polices in-force during Jan. 1, 2009, to March 31, 2013, and will send a notice and claim form to borrowers, who are eligible to receive restitution for premiums paid above the filed rates.
American Modern did a self-evaluation, which revealed an issue with respect to premium charges in excess of filed and/or approved rates on lender placed insurance products.
In addition to individual consumer’s restitution, Missouri will receive $145,819, paid to the Missouri State School fund.
Source: Missouri Department of Insurance
Was this article valuable?
Here are more articles you may enjoy.