Georgia Insurance Commissioner John W. Oxendine has fined Safeway Insurance Co. of Georgia $500,000 and given the insurer an ultimatum. Oxendine told the insurer it must: radically adjust its claims practices over the next two years or he will kick it of the state.
“We told them they have two choices,” Oxendine said. “They can leave now, or they can fundamentally reform the way they’re doing business.”
A subsidiary of Chicago-based parent organization National Safeway Co., the Georgia firm violated several state laws according to Oxendine, prompting him to levy the fine.
“This is a very unique order,” Oxendine said. “It’s the largest fine that has ever been imposed on an auto insurance company in Georgia.”
Oxendine believes Safeway’s adjusters are not adequately trained to perform to his state’s standards. He maintained that Safeway adjusters have a habit of “overriding” medical doctors’ findings on bodily injury cases without proper or qualified documentation.
In addition to imposing the largest fine ever in the state against an auto insurer, Oxendine is requiring that all Safeway’s adjusters participate in a state-run training program. He is requiring certified documentation in every case where an adjuster contradicts a medical professional’s findings.
The company will also be required to revamp its procedures for evaluating payments on vehicles that have been declared total losses and issue refunds for claimants who were previously underpaid for claims.
Oxendine said failure to comply with those and other conditions of his order would prompt a swift expulsion after a two-year, highly monitored grace period. “Someone will be looking over their shoulder for a long time,” Oxendine vowed. “The conduct of this company is unacceptable, and if I don’t see a reverse in their business practices, they face being kicked out of the state.”