Insurance Agents Who Cheat

There are insurance agents in Grand Prairie, Arlington, Dallas, Fort Worth, Mansfield, Crowley, Everman, Burleson, Benbrook, Lake Worth, and all over Texas. What happens when one of those insurance agent is cheating? The answer would depend on how it is that they are “cheating”. Some of their actions are violations of the Texas Insurance Code. Other times their actions are outright fraud or criminal in nature. One thing for certain is that an experienced Insurance Law Attorney needs to be consulted as soon as you think something is wrong.
A February 8, 2011, article illustrates what some agents do. The article was published in the MetroWest Daily News, a Framingham, Massachusetts, newspaper. The article is titled, “Insurance Scam Hits Framingham Towing Company.” The article is written by Danielle Ameden, a staff reporter for the newspaper.
The article in part says:
The state is investigating a licensed insurance agent who allegedly fleeced a local towing company into buying a fake insurance policy.
Townando Towing at 93 Beaver St. filed a complaint against Somerville agent James I. Rider last November with the state’s Division of Insurance. Rider claimed to have bought the firm a policy for commercial auto liability insurance back in November 2009 through Pilgrim Insurance, according to Townando.
But when Townando called to report two minor accidents last year, the company found out the deal was a fraud, office manager, Simone Barbosa, said.
“The policy number they had belonged to someone else,” said the attorney for the towing company.
Rider provided Townando with monthly invoices and collected payments, but kept the money and didn’t buy them insurance. “I was shocked to be honest with you,” said Barbosa. For the crashes, Townando, owned by Fernando Vieira, ended up having to pay for damage out of pocket.
As investigators work, Townando is seeking a settlement of over $25,000 from Rider for reimbursement, related costs and as payback for lost customers.
Townando is now fully insured through a different company, but his attorney says the damage has been done.
“In a community like Framingham, it’s important to keep your reputation if you’re a small business,” he said. “Nobody’s going to want to use a towing company that doesn’t have insurance.”
Townando counts filing a lawsuit as an option, his attorney says.
Rider has not returned calls.
His invoices list a post office mailbox address in Somerville and an office on Tufts Street.
A Division of Insurance spokesman said Rider’s agent license is still active.
Penalties the division commonly hands down as a result of investigations range from a cease and desist order to fines and / or license suspensions or revocations, said Jason Lefferts, spokesman with the state’s Office of Consumer Affairs and Business Regulation.
Barbosa filed a copy of her complaint with the Better Business Bureau and the Insurance Fraud Bureau of Massachusetts.
That quasi-private agency only does criminal work, and refers their investigations to district attorneys, the U.S. attorney’s office, state attorney general’s office and licensing agencies.
Rider never worked directly for Pilgrim Insurance, Pilgrim said in a statement. Instead, his agency was assigned on May 19, 2009, to work with Pilgrim as an involuntary agent by the Commonwealth Automobile Reinsurers. He wrote policies for high-risk drivers.
“Upon becoming aware of his assigned agency’s business practices and an ongoing investigation being conducted by the Division of Insurance, we terminated our relationship with James I. Rider Insurance Agency” last month, the statement reads.
Rider provided Townando with the plates and documents, but never any policy paperwork, Barbosa said.
“I would like to find out what’s going on,” Barbosa said recently at Dawley’s office.
While Vieira bought the policy from Rider before Barbosa started working at Townando, she said she dealt with Rider at past jobs for insurance.
If the above had happened in Texas, the first thing someone should do is contact an expereinced Insurance Law Attorney. Then depending on the advice of the attorney, there may be a complaint filed with the Texas Department of Insurance or even a phone call to the local district attorney office. The Texas Insurance Code provides many recourses depending on the exact nature of the wrong committed.