Agent issued policy 'on up and up'

By ROSELLE ZAYAS Business Editor E-mail: rosellez@sun-herald.com May 5, 2003

A Punta Gorda insurance agent accused of selling a policy for an unlicensed entity insists the transaction was legal.

"Everything was done on the up and up," said James Ulchinsky, one of 15 insurance agents in Florida whom the state's Department of Financial Services has filed an administrative complaint against for selling policies for various unlicensed entities already shut down by the department. DFS issued administrative complaints for agents who sold policies for various licensed entities already shut down by the department, including Physicians Exchange, Employers Mutual, Vanguard and TRG Marketing Group.

The insurance product Ulchinsky received a complaint for, the Local 16 National Health Fund, is a health plan for people who are self-employed or own small businesses. Ulchinsky, who has been selling insurance for about 14 years, said the plan fell under federal guidelines and was financially backed by an insurance company.

Ulchinsky said, at the time, he called the state to double-check that he was allowed to sell the plan in Florida.

"We were licensed agents. We sold a product that was licensed in the state of Florida," he said. "It, per se, was not an illegal product."

Ulchinsky, who sold nine or 10 of those policies, said what happened is that the plan apparently was so popular, after a time, the insurer was unable to handle the volume of claims and ceased operations Oct. 31, 2001.

"Unfortunately, the company went out of business," he said.