PENNSYLVANIA, USA — Acting Pennsylvania Insurance Commissioner Michael Humphreys yesterday released a market conduct examination report that resulted in an insurance company facing a hefty fine.
The examination of First Acceptance Insurance Company revealed that agents were misleading customers and adding optional coverages without their knowledge or full understanding.
Humphreys reported that First Acceptance agents selling policies over the phone led the customers to believe that these optional third-party coverages were included in the original policy and did not disclose that they were not required or that they incurred an additional cost.
"First Acceptance's business practices were unacceptable, and the Shapiro Administration will not stand for it," said Humphreys. "The Insurance Department will do everything we can to protect consumers and ensure that insurance companies comply with state and federal laws. Pennsylvanians concerned about company practices should always feel free to contact the Department for assistance, including about sales practices that seem misleading, or complaints about the way an insurance company addressed a claim or complaint."
The insurance company was cooperative with the investigation, which covered the 2021 calendar year. They were ordered to pay a $105,000 penalty and must address the violations.
"The department remains committed to pursuing entities that are misleading consumers. Examinations like these are a key tool to help the department in its ongoing oversight of the industry," Humphreys said.
The Pennsylvania Insurance Department may follow up with First Acceptance within 12 months to ensure that all of the examination report's recommendations were addressed to the Department's satisfaction.
Consumers who believe their insurance plans are not in compliance with commonwealth laws or regulations, or who have questions about the benefits to which they are entitled, are urged to contact the Insurance Department's Bureau of Consumer Services online or at 1-877-881-6388.
