• So You Received a Letter From The MIA...
  • June 3, 2003 | Author: Patricia McHugh Lambert
  • Law Firm: Pessin Katz Law, P.A. - Towson Office
  • Almost always, it comes in the mail- a thin, unassuming letter with the seal of the State of Maryland. A letter from the Maryland Insurance Administration. Some agents, believing that there is no need for concern, might bury it on their desk unconcerned about responding. Some agents rush to respond, dashing off quick notes without much thought. Still others agents panic, fearing that their career is in jeopardy. A letter from he MIA is never welcomed. In my many years of practice, I have never seen or heard of the MIA writing to an agent with a compliment. The MIA gives no award to agents for doing a good job. In fact, by the very nature of its mission, the MIA seeks to scrutinize agents. And they are there to discover problems. It was not always that way. Back in the 1980's, investigations of agents were few and far between. The MIA was understaffed and there was a willingness to resolve issues with a wink and a nod. With the 1990's, there was an increasing diligence about conducting investigations into the activities of agents. But investigations back then only occurred when someone complained. And there was still a willingness to resolve issues, if not with a wink and a nod, then with a small fine and a handshake except in the most egregious cases. Things have now changed. The MIA has grown and now has the resources and resolve to throw into an investigation. It listens closely to consumers. And many consumers are complaining about agents. Almost always, when a consumer complains, the MIA reacts with a letter to the agent. Of course, that's not the only time that the MIA writes to the agent with concern. The MIA has increasingly audited agent's files as part of its market conduct examinations of insurers. Make no mistake that the MIA is looking at the agent, as well as the insurer, in this type of review. And there are even a few stray investigations that come about from a report by an unlikely source; a disgruntled former employee or an ex-wife, for example. These investigations pique the interest of the MIA. And they should certainly be of concern to the agent. The MIA letter, then, should stiffen the back of an agent as much as a letter from the Internal Revenue Service. Neither is good news. And both can cause serious problems if not handled properly. It is surprising, then, that many agents treat the MIA letter so casually. If the agent received a letter from the IRS, the agent would undoubtedly call his/her accountant. But few agents call their lawyer, their insurance company or other professional before responding to the MIA. I suspect that agents do this because they consider themselves to be experts in the field of insurance. They feel that they know the Insurance Code and its regulations. If you should receive a letter from the MIA, squelch such feelings! Remember who you are dealing with. The MIA can fine you (and we are talking about big bucks here!). It can take your license away. It can cause trouble for you with your policyholders. It can hurt your future career. So what should you do? As an initial matter, take a deep breath. Count to ten, a hundred or a thousand depending on how high your blood pressure goes. And then come up with a game plan. And what should be the game plan? For that, see part 2 of this column...