The Third Quarter includes enforcement actions during the months of July, August, and September 2018.
Each quarter, the Division of Insurance publishes a list of the enforcement actions it has taken against licensed Resident and Non-Resident Producers operating in Massachusetts.
Fines imposed during this Quarter totaled over $5,500
The Third Quarter of 2018 saw a dramatic drop in the amount of fines imposed by the Division of Insurance. Unlike both the First and Second Quarters of 2018, which saw the Division imposed a total of $98,000 in fines, the total for Q3 was $5,500.
The largest fine this Quarter was also one involving a DOI Decision…
There were only three decisions for this Quarter, all of which involved Hearing Officer Decisions. The largest fine involved the decision issue in the case of Richard Coscia. As outlined in an earlier Agency Checklists’ article, on September 12, 2018, a Division of Insurance hearing officer, Kristina A. Gasson, revoked the resident insurance producer license of Richard R. Coscia (“Mr. Coscia”), the sole proprietor of the Richard Coscia Insurance Agency (“Coscia Insurance”) in Winthrop. The hearing officer found that Mr. Coscia continued to employ his son, Richard Coscia Jr. (“Richard Jr.”), at his insurance business in violation of The Federal Violent Crime Control and Law Enforcement Act of 1994.
Under this law, it is a federal crime for a person to engage or participate in the business of insurance if that person has ever been convicted of a state or federal felony involving dishonesty or breach of trust. Also, any agency, insurer or person involved in the business of insurance commits a separate crime by knowingly allows or permits “the participation of such a person in the business of insurance.”
For those interested in re-visiting the case, please refer to the article entitled, “Mass. DOI Revokes License For Allowing Employee with Breach of Trust Conviction to Work in Insurance Agency.”
A look at the other two enforcement actions published during the Third Quarter 2018
In addition to the cases discussed above, the following are the other two hearing decisions which resulted in the total of amount of fines imposed during Q3-2018.
- Mass License No: Paul E. Smyth
- Date: July 6, 2018
- Allegations: Misrepresenting Terms of an Insurance Contract; License Revoked by Other State; Failure to Report Administrative Action.
- Disposition: Hearing Officer Decision
- Fine: $500
- Licensing Action:Revocation; Cease & Desist
- Mass License No: Dawn Crowder
- Date: July 10, 2018
- Allegations: Failure to Report Administrative Action; Failure to Report Criminal Prosecution
- Disposition: Hearing Officer Decision
- Fine: $2,000
- Licensing Action: Revocation; Cease & Desist
To read about both of these cases, please refer to Agency Checklists July 17, 2018 article entitled, “Mass. DOI Hearing Officers Revoke Two Producers’ Licenses and Impose Fines Totaling $2,500.”
More about the Division of Insurance and its SIU unit…
While the primary mission of the Division of Insurance is “…to monitor the solvency of its licensees in order to promote a healthy, responsive and willing marketplace for consumers who purchase insurance products” a major part of that mission involves insurance enforcement. The DOI engages in a variety of administrative actions throughout the year in order to ensure that the insurance industry and its representatives maintain a just and healthy marketplace.
In the ordinary course of the Division of Insurance regulating the Massachusetts insurance industry, the Division’s Special Investigation Unit will pursue allegations of misconduct against any persons licensed by the DOI including:
- insurance producers;
- insurance advisers; public adjusters;
- reinsurance intermediaries;
- viatical loan brokers and providers;
- viatical settlement brokers and providers;
- insurance companies; health maintenance organizations; and,
- self-insurance groups.
As part of its investigation, the Division’s Special Investigation Unit may interview witnesses, question licensees, demand and review documentary evidence supporting allegations of unfair methods of competition or unfair trade practices or any other violation of the insurance law.
If a specific investigation warrants further action, egregious cases may result in a referral to the Attorney General’s office. In less serious cases the Division independently may negotiate settlements or request the Commissioner or his deputies to initiate an administrative proceeding before a hearing officer, issue a cease and desist order or compel written compliance programs. In more egregious cases, a licensee’s conduct may warrant sanctions including license revocations or suspensions along with restitution and possible fines.
To learn more about avoiding enforcement issues, you may be interested in Agency Checklists’ May 2, 2011 article “One Way to Avoid Large Fines for You & Your Agency.”
