Waltham, Mass. - Failure to properly terminate a policy tops the list of reasons property/casualty insurers are found to be out of compliance during market conduct exams, according to research from Waltham, Mass.-based Wolters Kluwer Financial Services' Insurance Compliance Solutions group. On the life/health side, failure to acknowledge, pay or deny claims within specified time frames is the most common market conduct compliance criticism for life/health.
The top 10 most common market conduct compliance criticisms for property/casualty insurance are:
1. Failure to properly terminate a policy
2. Failure to acknowledge, pay or deny claims within specified time frames
3. Using unapproved or unfiled rates
4. Failure to communicate a delay in the settlement of claims in writing
5. Failure to notify of producer appointments or terminations
6. Improper documentation of underwriting policies
7. Improper documentation of claims policies
8. Using unapproved or unfiled forms
9. Failure to produce requested records for an examination
10.Failure to provide required disclosures (such as selection/rejection issues or notices in the claims process)
The top 10 most common criticisms for life/health insurance are:
1. Failure to acknowledge, to pay or deny claims within specified time frames
2. Using unapproved or unfiled forms
3. Failure to adhere to advertising requirements
4. Failure to adhere to replacement requirements
5. Failure to notify of producer appointments or terminations
6. Using unapproved or unfiled rates
7. Failure to adhere to grievance and appeals requirements
8. Failure to provide required disclosures (such as explanation of benefits or guaranty fund notices)
9. Improper documentation of claims policies
10.Failure to properly terminate a policy
"Every department within an insurance organization—whether its claims, customer service, human resource or sales—is affected by compliance regulations," says David Evans, general manager of insurance compliance solutions at Wolters Kluwer Financial Services. "This means that insurers must identify potential risks before problems occur in order to protect their reputation and revenues, and most importantly, their customers."
Wolters Kluwer Financial Services reviews and analyzes the content in market conduct examinations from across the United States, assigning all of the criticisms to various categories. The categories with the most criticisms comprise the top-10 lists, which are compiled to help insurers steer clear of noncompliance.
Source: Wolters Kluwer Financial Services
