Illinois Dept. of Insurance Fines Universal Casualty

Universal Casualty Co. (UCC) is in hot water with the Illinois Department of Insurance. Last week, the department issued an order against the Elk Grove Village-based auto insurer for failing to adopt and maintain procedures for the prompt investigation and settlement of consumers’ claims. As a result, UCC, which does business in Illinois, Indiana and Missouri, is mandated to pay a $200,000 fine and correct its claims processes immediately.

In January 2008, the department ordered UCC to create and maintain improved claims investigation and resolution procedures. However, complaints from consumers continued to roll in about UCC's failure to properly address or resolve property damage and liability claims. Acting on behalf of Illinois consumers, the department initiated additional punitive measures and a new investigation of UCC on July 27, 2009.

According to the terms of the fine, $100,000 is payable in the event that the Department’s current examination finds that UCC’s corrective measures are unsatisfactory. The order also requires that UCC must revisit and satisfactorily resolve several hundred previous consumer complaints. UCC has informed the department of its effort to institute corrective measures, including the engagement of new management.

If UCC fails to undertake reforms as required by the order, it is subject to further disciplinary measures. As of posting, no one from UCC was available for comment.