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MARYLAND INSURANCE ADMINISTRATION

JUNE 24, 2004

One agent included in the sample was cited in the 1st quarter log of 1999 for non- compliant replacement activities and again for the same problem in the 4th quarter log. The Agency required the agent to be retrained on Company replacement rules in Maryland. Eleven other agents were cited for non-compliant replacement activities for this period. The Agency required that eleven of the agents be retrained. There was no documentation that the retraining had been performed or completed.

The agent highlighting information on the Company’s illustration was given a verbal warning and the agent failing to deliver policies (8) was put on a monitoring plan. Another agent cited for business conduct (not reporting to the office and failing to attend meetings) was given a verbal warning. The agent stated he would resign and did.

While this information is contained in the “Corrective Action Log”, there was no documentation for retraining and no entry in the agent file.

The examiners strongly suggest that these activities be documented and included in the agent personnel file, providing the Company with the ability to trend violations and take corrective actions.

The supervision of agents be it in regard to replacement activity, the improper use of policy illustrations, or the failure to deliver policies is imperative on the part of the insurer. The examiners could not verify that the Company took any corrective action regarding the agent activities. The above transactions are violations of COMAR 31.15.03.07C, which states an insurer is charged with the duty of supervising every agent for whom it has applied for a license and shall be accountable for the agents’ actions.

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MET LIFE REPORT NO. 786-01

PAGE 8

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