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People’s Trust MGA to Pay Penalty, Alert Consumers in Settlement Reached with CFO Sink

12/8/2009

CONTACT: Kyra Jennings or Nina Banister, (850) 413-2842
 
TALLAHASSEE– Florida CFO Alex Sink announced that People’s Trust Insurance’s Managing General Agent (MGA) will pay $100,000 and contact customers who may not have purchased insurance from a licensed agent, based on the terms of a settlement agreement with the Department of Financial Services finalized today.  In March 2009, CFO Sink’s Department of Financial Services took legal action against People’s Trust MGA, LLC charging that they had used unlicensed personnel to market and sell homeowners insurance.

“It is my responsibility to make sure Floridians are getting the best advice for protecting their families and homes by properly licensed agents,” said CFO Sink. “Standing up for Florida’s consumers is one of my top priorities, which is why it was so important to ensure that People’s Trust is following the law by only using licensed insurance agents in the transaction of their insurance business.”

People’s Trust MGA will pay a $100,000 administrative penalty, one of the largest penalties ever paid to the Department of Financial Services by an insurance agency.  People’s Trust MGA must also send a letter to every customer who bought homeowners insurance between March 6, 2008, and March 5, 2009, if their policies have not already been re-underwritten, offering a review of their coverage with a licensed insurance agent or customer representative. These customers will have the option to compare policies, re-underwrite their policy, or cancel their policy without penalties and have their pro-rated unearned premiums refunded.
People’s Trust must pay the $100,000 penalty within 30 days and mail the policyholder letters, to be approved by CFO Sink’s Department, at least 30 days prior to the renewal of the customers’ insurance policies.  The Settlement Stipulation for Consent Order was signed December 1, and formalized by the Consent Order signed today.
 
CFO Sink issued an Order to Show Cause on March 5, 2009 against the Boca Raton-based People’s Trust MGA, LLC after an investigation by CFO Sink’s Department revealed that People’s Trust MGA had allowed unlicensed agents to transact insurance. 
 
Consumers with coverage questions should visit CFO Sink’s web site, www.MyFloridaCFO.com, or call her consumer helpline at 1-850-413-3089 or 1-877-MY-FL-CFO. 
 
 
As a statewide elected officer of the Florida Cabinet, CFO Alex Sink oversees the Department of Financial Services.  A successful businesswoman with nearly three decades of experience in the private sector, Sink is serving her first term as Florida's CFO.  As CFO, Sink's priorities include using her business experience to cut wasteful government spending, cracking down on financial and insurance fraud and reforming the state government's contracting practices.