Holly Wallinger, Senior Attorney with Squire Patton Boggs gave an ethics presentation at the April 10, 2018 CAHU meeting at the The Grand Event Center at Grandview Yard in Columbus.
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Senior Attorney, Squire Patton Boggs
What is the most common mistake an agent or broker can make in regards to an ODI inquiry?
So a classic mistake that an agent can make with regard to having received notice of an investigation by the Ohio Department of Insurance is, not being quickly responsive, not being cooperative, and not participating fully in the proceeding. Insurance agents want to be forthright, and they want to be honest, and they want to report information to the department timely, not only in terms of what the statutory requirements are, but also in terms of appearing to be cooperative with the process.
What are the most common examples of ODI actions?
Many of the actions that we have reviewed, fall into a couple of categories. One category is failure to report revocation or suspension of another license. A securities license, for example. If your securities license has been revoked or suspended, you are under an obligation to report that information within 30 days to the Ohio Department of Insurance. Similarly, if an administrative action has been taken against you in another state, for example, maybe something relatively innocent such as not being compliant with continuing education requirements. If you are under an administrative action in another state, you want to report that to Ohio if you are licensed in Ohio, or if you are applying for an Ohio license, you want to disclose that in your application. The other bucket of actions that we’ve seen are the more serious offenses; failing to provide premium payments to the insurer after the insurer has provided them to the agent, stealing from clients, misrepresenting policy provisions to a client, forging a client’s name. Those are the more serious violations. But in fact, we’ve seen agents’ licenses revoked merely for not disclosing another state’s revocation of a license for continuing ed requirements. So you don’t want to assume that any violation that you’ve been notified of or alleged violation you’ve been notified of is not important or is a lesser offense. Take everything seriously and proceed accordingly.
Why this emphasis on ETHICS in Insurance Educational Requirements?
The Ohio Department of Insurance regulates insurance agents. And as part of that regulatory authority, the department’s mission truly is consumer protection. That is the impetus of all of the oversight that the Ohio Department exerts over agents. So what the department is concerned about is making sure that agents are acting properly in their interactions with clients, in their interactions with each other, and in the general transaction of business. Why is continuing education important? Number one, it’s a requirement. To maintain your license, you have to fulfill the continuing ed requirements as the statute and regulations explained. But more than that, continuing education provides agents with the opportunity to not only be reminded of what those duties are and what the potential violations are, but to also learn from the experiences of other agents and to talk these issues through to gain a better understanding of where is that line of what is permissible, crossed into what is impermissible.
What Do You Recommend if One Receives an ODI Notice?
So if you are under investigation by the Ohio Department of Insurance for an alleged violation, you can do a lot to help your case. The superintendent will consider what’s called special factors; how cooperative you were with the investigation, if there was a person harmed, did you make restitution to that person? Did you provide complete and accurate information to the department during the investigation? Were you able to provide any kind of testimony to your character? Do you have a long career without any administrative action at all? These are all factors that the superintendent can and should consider when reviewing the entire case. You may have made a simple mistake. There may have been a miscommunication. Take responsibility for the actions that you should take responsibility for, but make your case on both sides. Advocate for yourself and help the superintendent see the context of your situation. You’ve been an agent for 20 years without any kind of problem. You made restitution before you were even notified by the department. You’ve cooperated every step of the investigation as evidenced by your timely responses or providing documentations when requested. These are all important factors that you want the superintendent to be considering. You don’t want the superintendent to be limited only to the allegations in the consumer’s complaint.
What are Your Impressions of CAHU Members?
I think this was a terrific group. I mean they were excellent. I loved the back and forth. I appreciate perspective from people who have been in the business for 30 years. I appreciate the scenarios that people offered up It was–it was I think a really high level professional discussion, and I really appreciated it.
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