The South Dakota Division of Insurance has settled with Farmers Insurance Group and Foremost Insurance Group over allegations of industry “violations.” The deal includes a $750,000 penalty. While the specifics of the allegations are under wraps until the full report is released July, 6, 2015, this could impact the AGRR industry. Ron Evans, owner of Ron’s Auto Glass in Yankton, S.D., is particularly interested in learning more.
“The insurance industry is a challenge,” he says. “I don’t know what’s in the report, but I would like to find out. At this point we’re making more on rock chip repairs than installations.”
“A lot of our industry’s issues are with networks and insurance companies,” adds Shawn Nielsen, owner of Fast Auto Glass in Vermillion, S.D. “Like steering is an issue we deal with. I don’t know if this is a steering issue. … I’ve sent complaints into the state insurance division but I’ve never heard back.”
When asked if the settlement has anything to do with automotive glass claims, a spokesperson for the state’s insurance division declined to answer.
“The exam report will be available July 6,” says Dawn Dovre, a spokesperson for the South Dakota Department of Labor and Regulation.
“The examination report must remain confidential for 30 days,” according to an insurance division statement.
Five insurance companies within Farmers and Foremost were reviewed. The Farmer Insurance Group companies that came under analysis included Farmers Insurance Exchange, Fire Insurance Exchange and Mid Century Insurance Co.
The Foremost Insurance Group companies examined included Foremost Insurance Co. and Foremost Property and Casualty Insurance Co., according to a statement from the state’s insurance division.
The insurance division reports it “found various deficiencies in the companies’ practices that needed to be corrected.”
For its part, Farmers does not agree that it is doing anything wrong, but decided to resolve the issue through settlement, says a Farmers’ spokesperson.
“Farmers has reached a settlement agreement with the South Dakota Division of Insurance to resolve a market conduct exam. While we do not agree with many of the Division’s findings of alleged violations, we have agreed to this settlement in order to resolve the matter,” says Luis Sahagun of Farmers.
Larry Deiter, state insurance director, says “We have concerns any time an insurance law is violated in our state,” says “The number of violations in this particular report was a significant reason for the monetary penalty.”