Insurance Agent Accused of Fraud - MI News

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PostPosted: Sat Feb 09, 2008 2:52 pm   Post subject: Insurance Agent Accused of Fraud - MI News  

I am sure this probably happens more times than we hear but in todays news a Michigan Insurance Agent is accused of fraud in that he was taking the clients premiums but issuing fake insurance certificates then depositing the money into his personal account. Of course this left all the clients without any insurance although they were not aware of it until they began to get cancellation notices from the companies the policies were written on.



Also this news really is a kudo's for PROGRESSIVE INSURANCE . It states that out of all the companies only Progressive did the stand up thing and honor all claims and policies if the individual could prove they had paid this agent.





Quote:
Dozens of local motorists reported they were left without insurance or overpaid on premiums. Eleven former clients and a former employee testified Friday at Powers' preliminary hearing.



He is charged with five felonies, including insurance fraud, embezzlement and false insurance certification.



Assistant Prosecutor Everett Perry alleges Powers, who owned Powers Insurance Agency on North Street, accepted payments for insurance policies and did not forward all of the money to Progressive Insurance Co.



"Another four or five insurance companies were involved, but only Progressive did the stand-up thing and covered most of the more than $100,000 Powers shorted them on policies," Perry said. "Progressive even covered claims where clients could prove they paid him."



Typical of those with complaints, Evans said he paid premiums to Powers on time but would be pestered by late notices and policy cancellations from Progressive.



"At one point my fiance and I realized we had no insurance on a 1998 Ford Windstar for six months," Evans testified.




So I guess that no matter how hard we try at times to do the right thing, get the right coverages there may always be someone who is there waiting to take advantage.


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PostPosted: Sat Feb 09, 2008 4:06 pm   Post subject:   

But does Progressive use captive agents? I thought they did. If so, the agent would be a Progressive employee. If a Progressive employee gives you a written document stating you have insurance... you have insurance. If Progressive denied a claim, the person could then sue Progressive.



Again, I'm not sure if Progressive agents are captive or not.

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PostPosted: Sat Feb 09, 2008 4:28 pm   Post subject: Hi tscope  

Since I have not figured out yet just what is ok to post links to and what is not I did not post the link but the full article did state there were more companies involved. So not sure about the "captive" agent or not but according to the article the agent had sold under other companies.



I will re-read the rules about posting links and try to figure out what is "ok". I think sometimes giving the full article would be more helpful for everyone to understand the total news or article.



Laughing



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PostPosted: Sat Feb 09, 2008 4:28 pm   Post subject:   

OK mega, I found it.



Quote:
I am sure this probably happens more times than we hear but in todays news a Michigan Insurance Agent is accused of fraud in that he was taking the clients premiums but issuing fake insurance certificates then depositing the money into his personal account.




You are probably right about this situation happening often, but I just can't understand how it happens.



When I write an auto insurance policy, here's how it works:



(1) I quote the insurance first using the particular insurance company quote engine. When the quote is final, a quote number is issued and the quote is saved.





(2) If the customer wants the insurance, I go back to the quote and fill out the application and "issue" the policy. The following documents are then printed:



    Auto Insurance Application

    Receipt for the down payment

    Auto Insurance ID Cards




I have never had a customer who would leave my office without asking for an "ID" card to prove they had insurance. I really don't understand what an "Insurance Certificate" is. The "ID" card shows the policy number, the vehicle(s) with VIN numbers, the names of the drivers, contact information for the insurance company's claims department and usually a statement about "What to do in the event of an accident".



Why would anyone pay anyone "cash" without getting a proper receipt?



I hope this agent's license was revoked and now is working for the dog pound or something like that.



I just can't understand, in my wildest imagination, how anyone could leave an insurance agent's office with a "certificate", believing that was proof they had insurance.



That's one more reason why I am not in favor of buying any type of insurance online.


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PostPosted: Sat Feb 09, 2008 4:38 pm   Post subject: I posted the link in "latest news"  

Since I wasn't sure about posting the link with the post I went and added it to the "lastest news/info" links section so everyone could read the article in full. I may have missed something here but looks like this agent was writing for at least 5 companies (not just progressive) and that I got the crux of the charges correct. If you see something I missed let me know.



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PostPosted: Sat Feb 09, 2008 4:41 pm   Post subject:   

I would never pay any bill in cash with out a reciept of some sort. when people are this trusting, they get screwed. It is just too easy to ask for a reciept, why wouldn't you?

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PostPosted: Sat Feb 09, 2008 5:44 pm   Post subject:   

Quote:
But does Progressive use captive agents? I thought they did.
To my knowledge Progressive had NO captive agents AT ALL... They are all independents.


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PostPosted: Sat Feb 09, 2008 5:46 pm   Post subject:   

Maze, here is how this could and does easily happen...I go to the agents office say, 'dude, need insurance on this car' he decides which company he is going to write me in...fills out the app...prints from his computer a copy of the dec.page, and also from his computer a proof of insurance, takes my money, gives me a receipt...and never uploads it to the company, (guy changed his mind mr. insurance carrier-no he never gave me any money), and of course never deposited the poor guys funds to his trust account, to his own, of course instead...poor "Mr. Joe No Insurance" is driving around free as a bird.......I've personally seen this happen (in claims situations) about 10 times...



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PostPosted: Sat Feb 09, 2008 5:55 pm   Post subject:   

But Lori,



If an agent prints an application or a dec page prior to uploading the policy, it will have no policy number printed on it. The agent would have to manually write the policy number and surely a customer would question that.



Let's blog!



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PostPosted: Sat Feb 09, 2008 6:06 pm   Post subject:   

Quote:
The agent would have to manually write the policy number and surely a customer would question that.
Now Maze, if an agent knows he is going to steal this money do you really think he's going to have any trouble what so ever making up a policy number? Wink Honesty, and sadly I've had these very claims..in fact in all cases that is exactly how the agent got caught there was a claim....


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