North Dakota Insurance Commissioner Adam Hamm has fined an insurance firm that sold crop insurance in that state and ordered restitution to farmers.
The North Dakota Insurance Department announced the multi-layered disciplinary action against The Climate Corporation a/k/a The Climate Insurance Agency (formerly known as Weatherbill), a licensed business insurance entity that sold crop insurance products in the state from 2011 to 2014.
The commissioner’s consent order requires a total of $738,106 be credited to approximately 150 farmer customers in the form of premium return and premium waivers. Farmers will receive $485,948 to return previously paid premiums and any that still owe premium will be given waivers totaling $252,158. Additionally, the company must pay a $150,000 fine.
According to the commissioner’s order, the company misrepresented their producers as agents for the insureds and misrepresented the products they were selling as well. The order also states that at least 100 farmers who purchased coverage from the company “had historically low yields and profits during the 2012 growing season” but received no money from the insurance product they had purchased. The Climate Insurance Agency also offered to reduce premiums for insureds who complained about the “unsatisfactory performance” of the insurance product. Such offers are generally not permitted North Dakota, with certain exceptions.
“I am satisfied we were able to come to an agreement with the company on our numerous concerns with this product and the manner in which it was sold,” said Hamm. “The payments I have ordered in combination with the premium waivers and the fine are an appropriate response to the confusion and frustration caused by the actions of the company.”
Source – insurancejournal.com