In a strongly worded statement, the Minnesota Department of Commerce charged American Bankers Insurance Company of Florida and American Bankers Life Assurance Company with “willfully violating” Minnesota insurance law and said it will seek to stop the insurers from selling insurance in the state.
Minnesota Insurance Commissioner James Bernstein will also seek at least $10 million in fines.
American Bankers, based in Miami, for its part, filed a lawsuit in Minnesota district court on Feb. 5 asking the court to determine whether the department can impose additional penalties related to a multi-state market conduct exam dating back to 1998.
American Bankers, says company spokesman Jim Sykes, has already settled the issue through a 43-state agreement with regulators that included Minnesota. The agreement, he says, was reached in 1998 and included a $15 million settlement payment. Minnesota received $750,000 as part of that settlement, he adds.
A reexamination was agreed to and concluded in mid-2001, Sykes adds.
The department, however, contends the results of a market conduct exam show the companies have exhibited a “pattern of non-compliance” by illegally issuing more than 200,000 policies to Minnesota residents.