Massachusetts Division of Insurance Fines & Special Investigations During 2019

A re-cap of the total fines imposed by the Division of Insurance in 2019

Each quarter, the Division of Insurance publishes a list of the enforcement actions it has taken against licensed Resident and Non-Resident Producers.

The total fines assessed often vary depending upon the circumstances and actions alleged.

How much in fines did the Division impose in 2019

The Division of Insurance issues fines based on the types of disposition in individual cases. During the past year, the DOI issued a total of $29,850 in fines over the entire 12 month period. The highest fine of 2019 was issued to an Ohio-based insurance agency for unlicensed activity in the Commonwealth involving more than 150 violations of M.G.L. c.175 Sec. 175. The total amount levied against the agency was $4,500.

Fines involving official licensing hearing decisions published by the Division

The majority of cases handled by the DOI’s Special Investigations Unit ends with a Settlement Agreement which may, or may not, include a fine. For example of the 29 Enforcement Actions in 2019, 20 cases ended with a Settlement Agreement between the parties. Seventeen of the 20 actions also included fines, ranging from $100 to $2,000, to be paid in conjunction with the Settlement Agreement.

The DOI Special Investigations Unit was involved in a total of 29 investigations during 2019

Those cases that are not settled, then proceed to a hearing held at the Division of Insurance, after which an official decision is published. The following are the eight official hearing decisions that Agency Checklists reported on during 2019:

The Division’s Special Investigation Unit is in charge of investigating producers

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.

That said, during the course of 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 into a case, the Enforcement Division may interview witness, 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, an investigation may result in a referral to the Attorney General’s office in egregious cases or 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, agree to assist in cease and desist order and a written compliance programs. In more egregious cases, a licensee’s conduct may warrant the sanctioning of that producer’s license including revocation or suspension along with restitution.