The Insurance Journal reported Friday that four GEICO subsidiaries have been fined by the Connecticut Insurance Department for improper rating, claim delays and the use of unlicensed adjusters, among other violations.
The total fine – $177,500 – is the result of smaller fines assessed to the four subsidiaries, and follows a market conduct exam of GEICO operations in the state of Connecticut.
State Insurance Commissioner Thomas Sullivan told the press, “”We will continue to scrutinize companies in this industry to ensure they are committed to conducting business within the boundaries of our insurance laws.”
Connecticut law requires that all insurance agents be licensed by state, and that insurance companies must formally appoint any such agents who “sell, solicit, or negotiate insurance products on their behalf.” The market conduct exam revealed that each of the subsidiaries was employing unlicensed adjusters. Other violations included a failure to report “loss of use” distributions when making settlements.
It is unknown if these fines will cause GEICO to increase auto insurance rates in Connecticut.