Regulators: Unlicensed agents sold policies for People's Trust Beatrice E. Garcia The Miami Herald McClatchy-Tribune Regional News

Mar. 6--Insurance regulators have cited the company that manages People's Trust Insurance for using unlicensed agents to sell its homeowners policies.

The order by the Department of Financial Services, which regulates insurance agents, follows an investigation. State law requires agents be licensed.

The Boca Raton-based insurer doesn't use traditional agents to sell its policies, but works directly through the Internet and sales staffers on the phone.

DFS' order to show cause asks People's Trust to verify that all its agents are licensed.

Michael Gold, People's Trust president, said all 150 staffers now are licensed. In November 2007, he said, he consulted with DFS as he developed the business plan for the company and regulators were well aware that he wasn't planning to use all licensed agents.

He said some of the staffers taking questions from consumers on the phone provided answers that were prepared by licensed agents, using the same information that's provided online via the website's section on "frequently asked questions."

The company was approved for operation by the Office of Insurance Regulation exactly one year ago. It has since sold 35,000 homeowners policies.

Gold said as People's Trust began to sell more policies, insurance agents complained about its sales practices.

OIR confirmed that a complaint about People's Trust had been filed but wouldn't release it, saying its investigation was ongoing.

Some agents have complained that People's Trust might be touting policies with low premiums by providing high deductibles and low coverage limits in categories such as personal contents.

Gold is miffed by the regulators' treatment of People's Trust.

"You can't imagine how upsetting this is for the one company that has been trying to be a consumer advocate," said Gold in an interview late Thursday.

People's Trust has advertised aggressively in the last five weeks after State Farm Florida Insurance said it would no longer write property insurance in Florida and would leave the state in three years. People's Trust has said it would be willing to write more than 100,000 of the policies being dropped by State Farm.

Last fall, three inspectors from DFS visited the company officials, reviewed his records, talked with staffers and left with no complaints about his operations, Gold said.

In late December, he said he met with DFS officials in Tallahassee, again not getting a negative response from the regulators.

However, a week ago, his attorney was told by DFS that all of People's Trust agents had to be licensed.

Gold said he complied immediately. He arranged for the 50 staffers still not licensed to go through the three-day required training session. All have gone through the training and are awaiting their state certicates.

OIR said it's reviewing documents turned over by DFS as well as evidence collected by its own "comprehensive, ongoing investigation." It said the investigation includes allegations of using unlicensed agents.

OIR regulates insurance companies and agencies operating in Florida.

"It absolutely breaks my heart because I've put my blood, sweat and tears into building this company," said Gold, who got interested in the insurance business after he shopped for homeowners coverage after retiring to Florida.
Copyright (c) 2009, The Miami Herald Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA. Mar. 6--Insurance regulators have cited the company that manages People's Trust Insurance for using unlicensed agents to sell its homeowners policies. The order by the Department of Financial Services, which regulates insurance agents, follows an investigation.