CCH INSURANCE SERVICES Identifies Top Ten Reasons Insurers are Found Out of Compliance During Market Conduct Exams
Education is Key to Reducing Regulator’s Criticisms
BOSTON – Feb. 9, 2006 – As some insurance companies have learned the hard way, a market conduct exam uncovering noncompliance violations has the potential to cost millions of dollars in fines and lost business. To help insurers steer clear of costly noncompliance risks, CCH INSURANCE SERVICES, a part of Wolters Kluwer Financial Services, has identified the top ten reasons property and casualty insurers are found to be out of compliance during a market conduct exam.
CCH INSURANCE SERVICES’ industry research has shown that the top ten most common market conduct compliance criticisms are:
- Failure to pay or deny claims within specified time frames
- Using unapproved or unfiled forms
- Using unapproved or unfiled rates
- Failure to notify of producer appointments or terminations
- Failure to maintain complaints
- Failure to communicate a delay in the settlement of claims in writing
- Failure to produce requested records for an examination
- Failure to properly terminate a policy
- Improper documentation of claims policies
- Improper documentation of underwriting policies
“When issues are uncovered during a market conduct exam, the importance of compliance can be an expensive lesson to learn,” said Joe Bieniek, manager of regulatory compliance for CCH INSURANCE SERVICES. “Not only do the fines add up quickly, but what’s often worse is the irreparably tarnished reputation that can come from negative publicity surrounding an unsatisfactory exam, potentially causing a company to lose millions of dollars in business. That’s why it’s essential for insurers to be aware of possible compliance issues before they are identified as a problem during an exam.”
Because the most common compliance citations involve so many different functions within a company, it’s not just the compliance department’s responsibility to make sure correct procedures are being followed, noted Bieniek. Educating all employees about the importance of compliance within their job functions is key to a successful market conduct exam.
“Nearly every department is affected by compliance regulations, including claims, customer service, human resources and sales,” said Bieniek. “With the dramatic impact market conduct exams can have on a company’s reputation and revenues, understanding the importance of staying in compliance and ensuring that all employees are educated is more important than ever.”
CCH INSURANCE SERVICES is the leading provider of insurance-focused compliance tools, research, analysis, and forms. With more than 140 years of insurance regulatory experience, CCH INSURANCE SERVICES offers some of the industry’s most highly respected brands—NILS INSource, ComplianceWare®, Uniform AuthenticForms™, and AuthenticWeb™. CCH INSURANCE SERVICES provides a complete compliance solution -– from research and market conduct analysis to forms processing and integration services.
About Wolters Kluwer Financial Services
CCH INSURANCE SERVICES is a part of Wolters Kluwer Financial Services, a market leader and strategic customer unit of Wolters Kluwer, provides best-in-class compliance, credit, and operational risk management and work flow services and solutions; as well as capital changes and corporate actions data and tools to banks, credit unions, mortgage companies, securities organizations, and insurance companies throughout the United States. Its well-known brands include Bankers Systems, Atchley Systems, VMP Mortgage Solutions, PCi Corporation, GainsKeeper, AuthenticWeb, NILS INSource, Uniform Forms, and CCH Capital Changes. The organization’s solutions include documentation and documentation platforms; analytics; regulations and statutes tools; and capital changes and corporate actions services—all focused on helping its customers manage risk while becoming more efficient, productive, and responsive. For more information on Wolters Kluwer Financial Services, visit www.WoltersKluwerFS.com.
Wolters Kluwer is a leading multinational publisher and information services company. The company’s core markets are spread across the health, corporate services, finance, tax, accounting, law, regulatory, and education sectors. Wolters Kluwer has annual revenues (2004) of €3.3 billion, employs approximately 18,400 people worldwide, and maintains operations across Europe, North America, and Asia Pacific. Wolters Kluwer is headquartered in Amsterdam, the Netherlands. Its depositary receipts of shares are quoted on the Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices.