La. regulator fines Lyndon Southern over insurance code violations

Lyndon Southern Insurance Co. paid a $350,000 fine over 32 instances of improper activity and insurance code violations in Louisiana.

The Louisiana Department of Insurance conducted an examination on Lyndon Southern's activities between Jan. 1, 2015, and July 31, 2018, after receiving complaints from consumers. The regulator found that the insurer was not in compliance with the state's insurance code in areas of operations and management, complaint handling, underwriting and rating practices and claims handling.

Lyndon Southern's violations include failure to conduct periodic on-site reviews of the underwriting and claims processing operations of its third-party administrators or managing general agents and failing to rescind policies containing material misrepresentations even after denying policyholder claims based on those misrepresentations. The insurer also did not pay interest on premium refunds that were paid later than 30 days after their due dates and issued policies using expired base rates.

Of the total fine, $250,000 was for unfair or deceptive acts and practices. The other $100,000 was for other insurance code violations.

Lyndon Southern did not appeal the findings.