CDI Launches Enforcement Actions Against Tesla Insurance Over Alleged Claim Mishandling
The California Department of Insurance (CDI) has launched enforcement actions against Tesla Insurance Services Inc., Tesla Insurance Company, and State National Insurance Company. The companies are accused of mishandling hundreds of automobile insurance policy claims, potentially causing financial harm and third-party liability exposure.
The CDI has received consumer complaints about the handling of auto insurance policy claims since 2022. The companies are alleged to have failed to conduct thorough, fair, and objective investigations of claims, causing unreasonable delays and denials. They are also accused of not advising policyholders of their rights to have claim denials reviewed by the department.
The companies are said to have persisted with non-compliant claims-handling practices despite repeated warnings from the CDI. The actions allege that the companies' practices have resulted in egregious delays in responding to policyholder car insurance claims, leading to potential third-party liability exposure. The companies face potential penalties of up to $5,000 for each unlawful, unfair, or deceptive act, or up to $10,000 for each willful act. Unless resolved in favor of policyholders, the companies may face a hearing before an administrative law judge and significant monetary penalties. The responsible persons within the companies are not specifically identified, with only high-level leaders like Keith W. Demmings (CEO of Assurant) and Mario Greco (CEO of Zurich Insurance Group) named in the available search results.
The companies have 15 days to respond to the accusations. The CDI's actions aim to ensure fair treatment of policyholders and compliance with California automobile insurance laws. The outcome of the enforcement actions will determine the extent of penalties and potential changes in the companies' car insurance claims-handling practices.
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