The settlement, which was concluded in February 2024, addresses unfair claim practices discovered in a two-year review of the company's methods by the state regulator. The carrier was penalized $4 million as part of the settlement with the potential deduction of $2 million in lieu of compliance measures.
CSI alleged failure to conduct reasonable investigations or provide adequate explanation for claims denial in some instances.
The company has now made all its necessary updates in policy and training of its staff as of August, thus achieving a $1 million deduction. A follow-up exam to begin in 2025 will determine the fate of the second $1 million suspension according to CSI, contingent on an error rate below 8%.
“State Farm is cooperating with the Montana Commissioner of Securities & Insurance and actively working to resolve the issues identified in the market conduct examination report.”
The review covers accidents that occurred between November 2018 and April 2022, with State Farm having already paid an additional $1.18 million on 2,436 previously reviewed claims.
Montana Commissioner of Securities and Insurance Troy Downing applauded State Farm for diligently reviewing the claims and working with CSI to make good on the February 2024 consent agreement, ensuring the money is being returned to Montana consumers.
State Farm has the largest market share in Montana's private passenger auto insurance market with 22.63%, while Progressive Insurance Group follows with 19.96%.
No comments:
Post a Comment