The Missouri Department of Insurance (DOI) issued a cease-and-desist order against a Chicago-based auto insurance company, citing numerous consumer complaints and violations of state law. Department director John M. Huff issued the order June 11, forbidding Universal Casualty Co. from writing any new business in Missouri until certain allegations are resolved.
The director said the company violated Missouri insurance laws by:
• failing to respond to or properly investigate claims filed by policyholders within a timely manner;
• failing to respond to inquiries from the DOI, which is investigating consumer complaints;
• improperly denying claims; and
• offering unreasonably low dollar amounts for claims.
DOI statistics show Universal Casualty has more than 13 times the typical number of consumer complaints for a company its size. The department’s most recent complaint index for the company is 1354. A complaint index of 100 is considered average. The DOI has received 63 consumer complaints against the company in 2009, compared to 18 for the previous three years.
“The department has serious concerns about Universal Casualty’s ability to comply with Missouri consumer protection laws and treat its customers fairly,” says Huff, director of the Missouri Department of Insurance, Financial Institutions and Professional Registration. “We need to be convinced that the company has sufficient staffing and resources for handling insurance claims. Until then, we cannot allow the company to sell new policies in Missouri.”
The order forbids Universal Casualty from writing new business in Missouri – it can continue servicing its current policyholders in the state. According to DOI market share reports, the company wrote $5.9 million in premiums in 2008.
The investigation into Universal Casualty is ongoing, and consumers with complaints are encouraged to call the department’s Consumer Insurance Hotline at (800) 726-7390 or file a complaint at www.insurance.mo.gov.
