Wolters Kluwer Financial Services Unveils Annual List of Top 10 Criticisms on Insurance Market Conduct Exams

WALTHAM, Mass.--(BUSINESS WIRE)-- Wolters Kluwer Financial Services has released its annual list of the top 10 reasons insurance companies are found to be out of compliance during market conduct examinations.

The list, compiled by the company's Insurance Compliance Solutions group, provides insurers with a detailed picture of what regulators are looking for during compliance audits. This is the fifth year the list has been compiled, and the research is showing interesting trends.

Claims issues, such as timely claim handling and proper documentation of claims files, have clearly dominated the areas criticized each year, said Kathy Donovan, senior compliance counsel at Wolters Kluwer Financial Services. This pattern should serve as a wake-up call to insurers, who continue to receive fines and other sanctions for these noncompliance violations.

Wolters Kluwer Financial Services' insurance compliance experts reviewed and analyzed the content in last year's market conduct exams from across the U.S., and assigned the criticisms to various categories. The categories with the most criticisms comprise the top 10 lists for property and casualty, and life and health insurance. The data serves as a checklist of sorts to help insurers avoid noncompliance violations.

Wolters Kluwer Financial Services' industry research shows that the top 10 most common market conduct compliance criticisms for property and casualty insurance are:

Failure to acknowledge, pay or deny claims within specified time frames
Failure to properly terminate a policy, including inadequate days' notice, improper reasons, and omitted required language
Failure to pay claims properly (sales, tax, loss of use)
Improper documentation of claim files
Using unapproved or unfiled rates and/or rating errors
Failure to provide required and appropriate disclosures, such as selection/rejection or coverage notices in the underwriting process or notices like statute of limitations, reasons for denials, and bill of rights in the claims process
Failure to use licensed producers and provide proper notification of producer appointments or terminations, including maintenance of producer register
Failure to communicate a delay in the settlement of claims in writing
Using unapproved or unfiled forms
Use of unlicensed claims adjusters or appraisers
The top 10 most common criticisms for life and health insurance are:

Failure to adhere to advertising requirements
Failure to adhere to replacement requirements
Failure to use licensed and appointed producers and to provide proper notification of producer appointments or terminations, including maintenance of producer registers
Failure to adhere to grievance and appeals and utilization review requirements
Improper documentation of files
Failure to properly terminate a policy, including conversion requirements
Failure to properly acknowledge, pay, investigate, or deny claims within specified time frames
Using unapproved, unfiled or noncompliant forms
Failure to provide required disclosures, such as explanation of benefits statements, coverage issues, fraud warnings, free-look periods, right of appeal, or guaranty fund notices
Failure to pay claims properly
There is a misconception that market conduct information is easily accessible on state department of insurance Web sites, said David Evans, general manager of Insurance Compliance Solutions at Wolters Kluwer Financial Services. The truth is, market conduct information is not widely available and often hard to find. Our research and tools, including the annual top 10 lists, help insurers easily access the information they need and identify business practices that are of significant regulatory interest or that have resulted in fines across the industry.

A recent assessment by Wolters Kluwer Financial Services shows that 31 states offer access to market conduct enforcement actions online, and only 16 offer it in a way that can be easily used. The company's compliance experts have compiled two guides highlighting the availability of enforcement actions on state department of insurance Web sites”one for property and casualty insurance and one for life and health insurance.

For more information about Wolters Kluwer Financial Services' Insurance Compliance Solutions, visit https://insurance.wolterskluwerfs.com.

About Wolters Kluwer Financial Services

Wolters Kluwer Financial Services provides best-in-class compliance, content, and technology solutions and services that help financial organizations manage risk and improve efficiency and effectiveness across their enterprise. The organization's prominent brands include Bankers Systems, VMP® Mortgage Solutions, PCi, AppOne®, GainsKeeper®, Capital Changes, NILS, AuthenticWebâ„¢ and Uniform Formsâ„¢. Wolters Kluwer Financial Services is part of Wolters Kluwer, a leading global information services and publishing company with annual revenues of (2008) €3.4 billion ($4.9 billion) and approximately 20,000 employees worldwide. Please visit our Web site for more information.

Wolters Kluwer Financial Services

Jennifer Marso, 612-852-7912

Director, Corporate Communications

jennifer.marso@wolterskluwer.com

On Twitter: @JenniferMarso

or

Angela Peterson, 612-656-7745

Senior Public Relations Specialist

angela.peterson@wolterskluwer.com

On Twitter: @AngiePeterson

Source: Wolters Kluwer Financial Services