April 08, 2010

Department of Insurance gives auto insurer green light to resume writing business in Missouri

Jefferson City, Mo. - The Missouri Department of Insurance has lifted its restrictions on a Chicago-based auto insurance company, allowing it to start offering new policies in Missouri again. In June 2009 Director John M. Huff issued a cease-and-desist order against Universal Casualty Co., banning it from writing new business until it changed numerous business practices. Huff said at the time his department had a large number of consumer complaints and found numerous violations of state law.

Since the cease-and-desist order was filed, department officials have been working with Universal Casualty to ensure it was addressing the problems. On March 31, the department filed documents lifting the cease-and-desist order, saying the company had "demonstrated to the Director that it has implemented operational changes necessary to improve its business practices." Specifically, the company has agreed to respond to customer claims more promptly, make reasonable offers for claims payments and not make unreasonable demands of customers filing claims.

"This case is a great example of state regulators working with a company to get its house in order," said Huff. "A big part of our job is to ensure Missouri has a competitive insurance market, so we'd much rather see a company improve its business practices than have to shut it down."

Among the conditions met by Universal Casualty:

  • Smaller workloads for its insurance adjusters, allowing them to better respond to and service claims from policyholders;
  • Complaints by policyholders to the Department of Insurance are down dramatically since November 2009; and
  • The company has paid a $100,000 fine to the department for the previous violations of Missouri law.

According to Department of Insurance market share reports, the company wrote $5.9 million in premiums in 2008. Consumers with complaints about their insurance company or general questions about insurance can contact the department's Insurance Consumer Hotline at 1-800-726-7390 or file a complaint at insurance.mo.gov.