The Division of Insurance has announced two new enforcement actions since Agency Checklists’s report two weeks ago of the first three administrative actions taken by the Division in 2023. See Agency Checklists’ June 13, 2023 article, “3 DOI Enforcement Actions Published: A License Revoked For Premium Theft And 2 Agencies Fined.”
Volvo Financial Car Services fined $5,000 for placing policies while unlicensed
On May 1, 2023, the Massachusetts Division of Insurance (“DOI” or “Division”) sent a letter to Volvo Car Financial Services, U.S. (“Volvo”) about the DOI’s investigation into Volvo writing insurance while unlicensed. The letter stated that Volvo’s business entity producer license expired on or about June 20, 2021. Volvo did not reinstate its producer license until March 22, 2023. While unlicensed, the letter alleged, Volvo placed more than 230 insurance policies in Massachusetts.
The Division’s letter asserted that each policy placed by Volvo violated M.G.L. c. 175, § 175, “acting as an insurance producer without a valid license.” According to the Division, each violation carried a fine of up to $100 under § 175 but also violated M.G.L. c. 175, § 162R(a)(2), which could result in a fine of up to $1,000 or license suspension, probation, or revocation.
The DOI advised Volvo that its letter was not a public hearing notice. However, the letter did state if Volvo did not resolve the violations, the Division intended to file an Order to Show Cause and notify Volvo of a formal hearing date.
The Division’s letter proposed resolving the matter through a settlement if Volvo agreed to waive its right to a hearing, cease the alleged conduct, and pay a $5,000 fine. The letter further advised Volvo that the settlement, if accepted, would be considered a reportable administrative action for licensing purposes.
The Division gave Volvo until May 17, 2023, to accept the settlement offer before the Division would proceed with the Order to Show Cause and schedule a hearing.
On May 15, 2023, Volvo signed the settlement letter agreeing to pay the $5,000 fine.
DOI revokes Noah Jones’s resident producer license and fines him $1,000
In a May 24, 2023, Decision from the Massachusetts Division of Insurance (DOI), Noah Jones, a resident individual insurance producer, had his license revoked due to allegations of dishonest practices, including altering insured or applicant signatures during his tenure at New York Life Insurance Company.
The DOI served Jones its Order to Show Cause on January 17, 2023, alleging violations of G. L. c. 175, §§ 162R(a)(8) and (10). These statutes permit disciplinary action against an insurance producer for dishonest practices and forging signatures, respectively.
After failing to respond to the Order to Show Cause within the stipulated timeframe, the DOI filed a Motion for Entry of Default and Summary Decision on April 7, 2023.
The DOI hearing officer assigned to Jones’s Order to Show Cause granted the DOI’s motion, entered a default, and took evidence.
The evidence heard by the hearing officer of Jones’s activities included a Quality of Business Review report, provided by New York Life Insurance Company, which documented instances of Jones altering insureds’ documentation and signatures on several occasions between March 2019 and April 2020.
As a result, the DOI issued a series of orders on May 24, 2023, against Jones including:
- Revoking all insurance licenses granted by the DOI to Jones.
- Ordering Jones to comply with G.L. c. 175, § 166B, by disposing of any ownership stakes or employment positions in licensed insurance producers in Massachusetts.
- Requiring Jones to submit all Massachusetts insurance licenses in his possession to the DOI.
- Prohibiting Jones from engaging in any insurance business activities in Massachusetts, either directly or indirectly, and from acquiring any insurance business within the state; and,
- Fining Jones $1000 under G.L. c. 176D § 7, for violating G.L. c. 175 § 162R(a), with the fine to be paid within thirty days, by June 23, 2023.
