BISHCA Reaches Agreement with Allianz Insurance Company of North America and Issues Consent Order
Montpelier, Vt. – On April 22, 2010, Paulette J. Thabault, Commissioner of the Vermont Department of Banking, Insurance, Securities and Health Care Administration (BISHCA), signed a Settlement Agreement and Consent Order that concludes an examination conducted by the Department concerning sales and procedures of Allianz Life Insurance Company of North America during the years 2002 thru 2005.
BISHCA’s examiners found evidence that led the Department to allege that certain practices and procedures used by Allianz at that time were in violation of Vermont insurance laws and regulations. The Department identified criteria that led to the Department and Allianz agreeing that some sales of certain Allianz annuities to seniors aged 65 and older who surrendered the annuity at a loss should be reviewed to determine if the purchase of the annuity was or was not suitable. Vermont law prohibits insurers and agents from issuing or selling policies to individuals when the insurer/agent has reason to know or should have reason to know a policy would be unsuitable for the purchaser.
The Department saw marked improvement by Allianz since the period examined as Allianz began implementing measures to address the issues raised by examiners. Upon review of Allianz’s measures, BISHCA commended the company on its proactive efforts to comply with Vermont law and properly represent products to consumers.
The examination also found that some Vermonters were not paid the proper amount of interest on their life and annuity claims during the period reviewed. Allianz agreed to pay these beneficiaries the additional amount they should have received. A number of other areas were also addressed. The signed Settlement Agreement and Consent Order and corresponding documentation are available on the BISHCA website: http://www.dfr.vermont.gov/reg-bul-ord/allianz-life-insurance-company-north-america.
“The work of our insurance examiners throughout this investigation, as well as the efforts Allianz has undertaken to address the issues raised are all good news for Vermonters,” said Commissioner Thabault. “BISHCA’s primary goal, as was seen in this case, is the protection of Vermont consumers, and I am pleased to know that the interests of Vermonters who purchase insurance will be further safeguarded by the appropriate measures put in place by Allianz.”
The Department of Banking, Insurance, Securities and Health Care Administration (BISHCA) is a state agency that touches the lives of every Vermonter through the regulation and monitoring of a broad spectrum of financial and health industry activities. The Department’s job is to protect consumers against unfair and unlawful business practices in the areas of banking, securities (investments) and insurance, while ensuring that licensed entities are financially healthy. The ongoing work of the Department on behalf of Vermonters helps consumers access financial and health related services with confidence that:
- Consumers are treated fairly, according to the terms of contracts and laws.
- Regulated companies, institutions and individuals operate within the law.
- Regulated entities operate in a financially sound manner, and remain able to deliver on consumers’ earnings, benefits, claims, or other services.
- Costs and services are reasonable for the marketplace.
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