At the Governing Committee meeting held on Wednesday, June 20, the following was reported, reviewed, and decided upon:
- During the President’s Report, CAR President Daniel Judson announced that CAR had suffered a data security breach. Unintentionally, some consumers’ personal information was inadvertently published on CAR’s website. Mr. Judson stated, however, that the error was immediately identified and corrected and that CAR’s IT staff was even able to remove all traces of the information from the site. The affected consumers were also duly notified of the breach.
- During the Compliance Audit Committee Report, the Governing Committee heard the Subcommittee’s recommendation to conduct a focus audit of the Progressive Direct Ins. Co. in the first quarter of next year (2013). The recommendation was made as a result of the Committee’s issues that it has had with the insurer’s ability to comply with CAR’s statistical reporting procedures. The Compliance Audit Committee feels that a result, further action is required in order to monitor the insurer’s corrective actions taken to address their statistical reporting issues impacting quota share and ratemaking data. As a result of the report, the Governing Committee approved the Subcommittee’s recommendation that CAR President Daniel Judson meet with the Commissioner of Insurance in order to address those issues outlined in the Compliance Audit Committee’s report regarding Progressive’s adherence to statutory requirements and CAR Rules.
- During the Loss Reserving Committee Report, the Governing Committee accepted the Subcommittee’s recommendation that at the next Compliance Audit Committee meeting in September, the decision of whether or not to continue to seek an unqualified opinion and reserve certification should be discussed as well as the idea of conducting a biannual review. It was suggested that while worthwhile, an unqualified opinion and reserve certification should be weighed against its costs particularly in light of its conversion to an auto insurance plan, the continuing decline in liability and reserve levels and the small number of commercial Servicing Carriers who are actually required to be monitored.
- On June 13, 2012, the Market Review Committee upheld Safety Insurance’s termination of the Calianos Insurance Agency’s taxi and commercial automobile Servicing Carrier Agreements. The vote was by a vote of 5 in favor, 3 opposed and 2 recused, with the two recused being Jason Calianos, of the Calianos Insurance Agency and Mr. Edward N. Patrick, both of whom sit on the Market Review Committee. Safety had issued the notice of termination to Calianos in response to what it had said were the agency’s violations of Rule 13.B.2.a, Rule 12.B.2.f. and Rule 15 of the CAR Rules which include the issues of “…failure to remit payments to a Servicing Carrier on a timely basis, failure to comply with reasonable procedures of the Servicing Carrier for remitting premium and failing to remit premium payments in accordance with the contract signed with the Servicing Carrier.” Mr. Calianos appealed the Market Review’s decision to the Governing Committee. After reviewing the Market Committee Report which included a history of the case, the Governing Committee decided to accept the Market Review Committee Report in its entirety thereby denying Calianos’ appeal.
