Maine Insurance Superintendent Mila Kofman has entered into a settlement with Bankers Life and Casualty Company. Under the agreement, the company will pay a $500,000 civil penalty for improper sales practices and inadequate sales force training. Additionally, the Company has agreed to offer refunds plus incurred interest to any consumers who answered Medicare solicitations and were then sold other Bankers Life insurance products. Superintendent of Insurance Kofman stated:
We do not tolerate unlawful insurance sales practices in Maine, and we find it especially egregious when seniors or other vulnerable populations are targeted. In this case, the improper sales practices were the result of inadequate training and the company has accepted responsibility and agreed to make all affected consumers whole.
The agreement concludes an investigation by the Bureau of Insurance and the Office of the Attorney General resulting from a complaint to the Bureau of Insurance by an 80-year-old woman who had answered a mailing from Bankers Life offering “an important booklet concerning your latest Medicare Hospital and Medical benefits and deductibles.” After meeting with two Bankers Life agents in her home, the woman was persuaded to use $37,000 of the $42,000 in her bank account to purchase an annuity.
Concerns about these “cross-selling” tactics led the Maine Legislature to pass a law in 2007 prohibiting insurance agents from making appointments to discuss Medicare products and using them to solicit business for annuities, life insurance or health insurance products. Bankers Life admitted that it failed to properly train its agents about Maine’s cross-selling law.
In addition to the $500,000 civil penalty and refund aspect, Bankers Life has also agreed to an independent audit that will identify all sales of other products that resulted from Medicare appointments after the cross-selling law took effect. This will identify affected consumers, giving them the opportunity to cancel these transactions, and making them whole for any adverse tax consequences or other financial losses. Finally, Bankers Life has agreed to provide training in the new law for all of its sales representatives.
Source: Associated Press
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.