NJ Insurance Regulators Recover $23 Million for Policyholders

The New Jersey Department of Banking and Insurance (DOBI) announced this month that it recovered almost $32 million from banks and coverage providers last year on behalf of consumers, which represents an increase of more than 50 percent from the year before.

DOBI recovered the sums at the end of investigations into misconduct on behalf of financial institutions operating in the state.

The following breakdown shows who got what portions of that $32 million figure:

  • $23 million went to insurance policyholders.
  • $6.8 million went to medical providers who were owed money by insurers.
  • Over $2 million went to consumers who had paid for banking and financial services businesses and were overcharged.

Most of the payments that went to policyholders had their origins in complaints they had filed with the DOBI regarding their insurers.

According to the announcement from regulators, most of the payments to policyholders were reimbursed because they had experienced delays in claims processing, improper claims handling, denials of claims, improper ratings or unreturned unearned premiums.

“I am pleased that the Department was able to significantly increase the amount of recoveries we gained for consumers and providers last year,” said acting commissioner Ken Kobylowski in a prepared statement, “and I am particularly gratified that we were able to help consumers who suffered losses in Hurricane Irene and Tropical Storm Lee.”

The complaint data generated through these investigations will be compiled by regulators and put into a consumer-complaint report that will be made available to the public.

These reports can service as basic car insurance company ratings that give an idea of insurer’s customer service track record.

The reports list consumer-complaint ratios that show a number representing the total number of complaints filed against a company divided by the number of cars that company insured that year.

The general view is that the lower the ratio, the better the chances are that future customers will not run into problems with that carrier.

In 2010, New Jersey Manufacturers and Palisades had the two best rankings. Personal Service Insurance and IFA had the worst.

About Matthew Morisset
Matthew Morisset is a proud alumnus of the University of Redlands, where he obtained a degree in English Literature. Utilizing his passion for analysis and writing, Matthew looks for important trends in the auto insurance industry and their implications for consumers and the market as a whole.

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