The California Department of Insurance is in charge of regulating insurance agents, adjusters and other insurance professionals in this state.
Part of the Department’s job is to make sure that these insurance professionals maintain high ethical standards and follow the laws of this state.
This means that when the Department believes a professional has fallen short of their obligation, the Department will conduct an investigation into the professional’s affairs.
If the Department finds that the professional broke an insurance law or regulation of this state, the Department may revoke the person’s license or impose a suspension.
The fallout from this type of discipline is serious since it means the professional can no longer legally work in the insurance business. They will have to find another source of income, at least for a time.
The Department also might impose lesser penalties, including fines or restrictions on one’s license.
Insurance professionals’ honest mistakes can cost them
The Department pursues professionals for flagrant violations like fraud and theft, and this probably comes as no surprise to those who live and work in Southern California.
Likewise, serious blemishes on one’s character, like a criminal conviction, can prompt the Department to take disciplinary action.
However, insurance is a complicated area of the law with many do’s and don’ts. Even an experienced professional can get tripped up and wind up in legal hot water with the Department over conduct that, to the general public, might not seem like a problem.
Moreover, the Department also has the authority to discipline professionals for lesser things than outright dishonesty. Simple financial mismanagement or professional negligence, for example, can be grounds for discipline.
An insurance professional who is the target of a California Department of Insurance case should take the matter seriously and understand their legal rights and options fully.