Delaware Regulators Recover $1.8 Million for Policyholders

Delaware regulators announced this week they recovered more than $1.8 million for consumers in the first nine months of the year, putting the state on track to surpass the $2.1 million recouped for all of 2010.

The funds—the result of following up on complaints against insurers, regulating companies’ business practices and resolving disputes between policyholders and coverage providers—were returned to Delaware car insurance, homeowner and other policyholders.

“I want the people I serve to know that my administration continues, through regulation and restitution, to have their backs,” state Insurance Commissioner Karen Weldin Stewart said in a statement. “Successfully protecting Delawareans is the art of balancing several forces that include keeping premiums minimal, a variety of carriers and products available, and the insurance companies viable.”

The recoveries were not broken down by coverage type, but regulators said nearly $600,000 was obtained as a result of arbitration, with another $580,000 resulting from following up on complaints against companies and more than $650,000 stemming from oversight of insurers’ market conduct.

Officials say the department uses a system provided by the National Association of Insurance Commissioners (NAIC) to keep track of consumer complaints and inquiries.

“With this technology, we have modernized our ability to track potential problems as well as calculate how much money our department was able to recover or save … policyholders,” Stewart said.

Earlier this month, Stewart announced she had fined Allstate and Encompass a combined $50,000 for separate violations of state law.

Allstate agreed to pay a fine of $25,000 for failing to provide defensive driving discounts to qualifying policyholders, according to department officials. Encompass agreed to a similar penalty for illegally imposing an accident surcharge on customers who were in crashes they did not cause, regulators said.

Both insurers waived their right to administrative hearings over the violations, which affected nearly 3,650 policyholders, and issued refunds totaling more than $848,000, according to regulators.

Allstate and Encompass cited computer errors and programming oversight as the causes of their violations, and have reportedly fixed those problems.

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.

No comments yet.

Comment on this article