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December 22, 2010 at 07:00 PM
The New York State Insurance Department has fined three affiliated life and annuity agencies $2 million in connection with concerns about product replacement practices.
The agencies — Citicorp Insurance Agency Inc., Citicorp Investment Services, and SBHU Life Agency Inc. – are units of Citigroup Inc., New York.
The agencies already have paid the fine, according to New York State Insurance
Superintendent James Wrynn.
The department imposed the fine in connection with product replacements that took place from 2003 to 2007.
Citigroup is pleased to have resolved the matter, a company representative says in a statement.
A New York department examination “found certain inadvertent violations and other issues under the Insurance Law and department regulations,” the company representative says “We have taken appropriate steps to address the department’s concerns. Citi regularly reviews its policies and procedures in order to best serve our clients.”
Under New York Insurance Law and the New York department’s Regulation 60, a producer selling a replacement for a life insurance or annuity contract must give the consumer information about why buying the new product would be better than keeping the old product.
