NY Ins. Dep't Cites 2 Life Ins. Complaints in 11/20 Press Release
Historically, life insurance has resulted in few complaints to Insurance Departments when compared to property/casualty or health insurance. However a [press release] issued today by the New York State Insurance Department discusses three complaints, two of which are life insurance complaints.
The press release touts $8.12 million in funds returned to consumers in the third quarter 2009 as a result of NYSID intervention. The two life insurance complaints together amounted to less than $60,000. Both complaints involved pretty small face amount policies. Despite the low dollar amounts involved, they are featured prominently in the release suggesting that perhaps life insurance complaints are more common and are higher on the Department's radar than they have been in the past.
Insurers would be very well served by making sure, in these difficult times when budgets are under great pressure but regulatory attention is heightened, that compliance, market conduct, claims and complaint handling do not get short shrift. The reputational harm to the company and the industry far outweighs the short-term budget relief that may result from cuts to these areas. A quick look at this press release is a good reminder for life insurers.
Thanks for the reminder. Compliance has to remain a high priority.