Pierce National Life hit with $20,000 fine.Pierce National Life hit with $20,000 fine A small Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. County life insurance company recently agreed to pay a $20,000 fine for violating a California Department of Insurance The California Department of Insurance (CDI), established in 1868, is the angency charged with overseeing the regulation of insurance regulations, enforcing statutes mandating consumer protections, educating consumers, and fostering the stability of insurance markets in the state order prohibiting it from soliciting or selling any new or renewal policies in California. While Pierce National Life Insurance Co. will now be allowed to resume soliciting and selling policies, the fine is the latest chapter in a continuing dispute with the state over the company's financial health and its ties to its owner, Washington multimillionaire mul·ti·mil·lion·aire n. One whose financial assets are worth several million dollars. multimillionaire Noun a person who has money or property worth several million pounds, dollars, etc. Joseph Allbritton. Still in effect is a provision of the order prohibiting the company from paying future dividends to stockholders and making transactions with Allbritton or any of Allbritton's companies. Allbritton, chairman of Riggs National Bank, the largest bank based in the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). , in July agreed to pay back a $12 million dividend Pierce had earlier paid him. The dividend, deemed illegal by the Department of Insurance, was in part responsible for the insurer falling into hazardous financial condition. The company's capital surplus - its cushion against policyholder claims - was well below the legal minimum when a cease and desist order An order issued by an Administrative Agency or a court proscribing a person or a business entity from continuing a particular course of conduct. The force and effect of a cease and desist order are similar to those of an Injunction issued by a court. against issuing new insurance was handed down June 29. Insurance Commissioner John Garamendi John Raymond Garamendi (born January 24, 1945) is a U.S. politician and a member of the Democratic Party. He became the 46th Lieutenant Governor of California on January 8 2007. said that with the payment, the company may soon be in the department's good graces. "The response from Pierce National Life Insurance Co. to quickly remedy their insolvent situation and get back on the road to operating a sound and credible business is a positive sign that the company plans to use better judgement when conducting business in California." The department charged the insurance company with paying illegal dividends to Allbritton after manipulating its accounting records and artificially inflating earnings. An attorney for Allbritton denied that his client committed any improper actions. |
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