Boston - As some insurance companies have learned the hard way, a market conduct exam uncovering noncompliance violations has the potential to cost millions of dollars in fines and lost business. To help insurers steer clear of costly noncompliance risks, CCH Insurance Services, a part of Wolters Kluwer Financial Services, has identified the top 10 reasons property/casualty insurers are found to be out of compliance during a market conduct exam.CCH's research has shown that the most common market conduct compliance criticisms are:
"When issues are uncovered during a market conduct exam, the importance of compliance can be an expensive lesson to learn," says Joe Bieniek, manager of regulatory compliance for CCH Insurance Services. "Not only do the fines add up quickly, but what's often worse is the irreparably tarnished reputation that can come from negative publicity surrounding an unsatisfactory exam, potentially causing a company to lose millions of dollars in business. That's why it's essential for insurers to be aware of possible compliance issues before they are identified as a problem during an exam." Because the most common compliance citations involve so many different functions within a company, it's not just the compliance department's responsibility to make sure correct procedures are being followed, notes Bieniek. Educating all employees about the importance of compliance within their job functions is key to a successful market conduct exam.
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