California’s insurance commissioner has issued a notice of noncompliance against
The action follows a department investigation that found numerous areas where Mercury’s business practices harmed policyholders across its private passenger auto, commercial auto, homeowners and commercial multi-policy lines of insurance, department officials said.
The investigation was based on a review of policies issued, renewed, cancelled, non-renewed, or declined during a randomly selected period running from
“Failing to sell good drivers the lowest priced policy for which they qualify is illegal, and my department will act on behalf of consumers and pursue the maximum penalties against Mercury for acting in bad faith,” Insurance Commissioner
In a statement released late Monday, Mercury said it “strongly disagrees with the allegations.”
“The company has been working in good faith with the (
Lara said Mercury’s actions violate Proposition 103, a 1988 voter-approved initiative that mandates a 20% “good driver discount” for consumers who maintain a safe driving record.
Consumer Watchdog founder
“Mercury is well-aware this is illegal because it has tried to change the law for two decades,” Rosenfield said in a statement. “Today’s enforcement action by the insurance commissioner is the first step in finally holding this recidivist company accountable for its deliberate law-breaking.”
Mercury maintains two insurance companies in
The department’s investigation found a number of ways that Mercury illegally sold and steered drivers to its company with the higher-priced plan:
The department also alleges Mercury overcharged businesses and homeowners in other lines of insurance through a variety of illegal practices that resulted in discriminatory rates.
As an example, the company increased premiums for commercial drivers who had been in an accident where they were not at fault.
The allegations – 34 in all – are detailed in the department’s notice of noncompliance.
Mercury paid a
No fine amount has been set for Mercury’s latest violations, department officials said.
Mercury said it will continue to work with the
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