Source: http://www20.insurance.ca.gov/epubacc/REPORT/90769.htm
Timestamp: 2018-01-19 05:47:24
Document Index: 785581361

Matched Legal Cases: ['§ 2695', '§ 2695', '§ 2695', '§ 2695', '§ 2695', '§ 2695', '§ 2695', '§ 2695', '§ 2695', '§ 2595']

NAIC # 12521 CDI # 3595-6
NAIC # 10939 CDI # 4536-9
TABLE OF CITATIONS BY LINE OF BUSINESS...........................................6
NAIC # 12521
NAIC # 10939
Group NAIC # 0257
Hereinafter referred to as The Companies, SIC and SDIC
The examination covered the claims handling practices of the aforementioned Companies during the period April 1, 2005 through March 31, 2006. The examination was made to discover, in general, if these and other operating procedures of the Companies conform with the contractual obligations in the policy forms, to provisions of the California Insurance Code (CIC), the California Code of Regulations (CCR), the California Vehicle Code (CVC) and case law. This report contains only alleged violations of Section 790.03 and Title 10, California Code of Regulations, Section 2695 et al. The alleged violations of other relevant laws which resulted from this examination are included in a separate report which will remain confidential subject to the provisions of CIC Section 735.5. .
The examination was conducted primarily at the offices of the Companies in Monrovia, California.
The examiners reviewed files drawn from the category of Closed Claims for the period April 1, 2005, through March 31, 2006 commonly referred to as the "review period". The examiners reviewed 314 SIC claim files and 56 SDIC claim files. The examiners cited eight claim handling violations of the Fair Claims Settlement Practices Regulations and/or California Insurance Code Section 790.03 within the scope of this report. Further details with respect to the files reviewed and alleged violations are provided in the following tables and summaries.
Private Passenger Automobile Bodily Injury Liability
Private Passenger Automobile Property Damage Liability
Private Passenger Automobile Uninsured/Underinsured Motorist Protection
CCR § 2695.7(c )(1)
CCR § 2695.7(p)
CCR § 2695.85(a)
The Company failed to provide the insured with the Auto Body Repair Consumer Bill of Rights.
The following is a brief summary of the criticisms that were developed during the course of this examination related to the violations alleged in this report. This report contains only alleged violations of Section 790.03 and Title 10, California Code of Regulations, Section 2695 et al. In response to each criticism, the Companies are required to identify remedial or corrective action that has been or will be taken to correct the deficiency. Regardless of the remedial actions taken or proposed by the Companies, it is the Companies obligation to ensure that compliance is achieved. There were no recoveries made during this examination.
1. In two instances, the Companies failed, upon acceptance of the claim to tender payment within 30 calendar days. The Department alleges these acts are in violation of CCR § 2695.7(h).
Summary of Companies' Response: The Companies acknowledge these criticisms and states the adjuster did not follow procedure. Upon acceptance of claims and required releases, the Companies procedure is to immediately issue payment. Individual counseling will take place as needed in order to avoid future delays. Further, claims adjusters will be trained in August 2006 to reinforce compliance with claims handling procedures, California Insurance Code and Fair Claims Settlement Practices Regulations.
2. In one instance, the Companies failed to acknowledge notice of the claim within 15 calendar days. The Department alleges this act is in violation of CCR § 2695.5(e) (1)
Summary of Companies' Response: The Companies acknowledges this criticism. They will address the department's concern with the individual claim handler and will continue to assure compliance through use of training, internal audits and supervisory oversight.
3. In one instance, the Companies' failed, upon receiving proof of claim, to accept or deny the claim within 40 calendar days. The Department alleges this act is in violation of CCR § 2695.7(b).
Summary of Companies' Response: The Companies acknowledge the Examiner's findings. The claims handler was individually counseled to ensure future compliance.
4. In one instance, the Companies failed to provide written notice of the need for additional time every 30 calendar days. The Department alleges this act is in violation of CCR § 2695.7(c) (1).
Summary of Companies' Response: The Companies acknowledge that they failed to send status letters in this instance. The claims handler was individually counseled to ensure future compliance.
5. In one instance, the Companies failed to conduct and pursue a thorough, fair and objective investigation of a claim. The Department alleges this act is in violation of CCR § 2695.7(d)
Summary of Companies' Response: The Companies agree with the finding. The Companies addressed this noncompliance issue with the individual claims handler. The Companies reinforce compliance with claims handling staff through continuous training, internal audits and supervisory oversight.
6. In one instance, the Companies failed to provide written notification to a first party claimant as to whether the insurer intends to pursue subrogation. The Department alleges this act is in violation of CCR § 2695.7(p)
Summary of Companies' Response: The Companies agree with the findings. The individual adjuster has been counseled to provide written notification to first party claimants when subrogation will be pursued or discontinued.
7. In one instance, the Companies failed to provide the insured with the Auto Body Repair Bill of Rights, either at the time of application for automobile insurance, at the time a policy is issued, or following an accident. The Department alleges this act is in violation of CCR § 2595.85(a)
Summary of Companies' Response: The Companies agree with the findings and state that this is an isolated incident. The adjuster has been counseled. Further, the Companies held an August 2006 meeting to emphasize compliance with the Fair Claims Settlement Practices Regulations.
Last Revised - December 08, 2006