1. News Articles
  2. Related News Articles
News Article Details

NY Regulator Settles Unlicensed Adjusters Dispute with Chartis

Source: AM Best

Posted on 08 Jan 2010

Facebook LinkedIn Twitter Google

Chartis, the commercial property/casualty division of American International Group Inc., has paid a $495,000 fine to New York to settle accusations by the state's insurance regulator of allowing its employees to act as independent adjusters without licensing.

Chartis Claims Inc. was named in a newly issued disciplinary report from the New York Insurance Department, logging recent cases.

People paid by Chartis improperly conducted insurance business in New York State. "They were acting as adjusters without a license," said Ron Klug, a department spokesman. "There were approximately 1,000 people that were unlicensed."

The other amounts detailed on this latest state disciplinary report typically ranged from about $500 to $5,000. Chartis' penalty was considerably more, though Klug said its not unheard of for companies to face such a fine, or even a greater one. However, he added: "It's substantial, obviously."

According to a stipulation agreed to and signed by a senior executive at Chartis, the company admitted the unlicensed activity went on from April 2007 to July 2009, and that it included conducting business "under the unlicensed names 'AIG Domestic Claims Inc.' and 'Chartis Claims Inc.' " The agreement said that the "violations were not the result of any conscious company policy to evade the requirements of the insurance law" and that Chartis "has taken substantial steps to address the conditions that gave rise to the violations."

The company agreed to the fine in settling the matter. "The fine has been paid," Klug said.

A spokeswoman for Chartis said the company is not commenting on the situation.