TDI Issues Bulletin Regarding Unauthorized Insurers
The Texas Department of Insurance (TDI) has issued a bulletin to remind insurance agents and third-party administrators (TPA) that they may be held responsible for assisting a company engaging in the unauthorized business of insurance under the Texas Insurance Code, Chapter 101.
TDI’s bulletin specifically notes that unlicensed and unauthorized companies are marketing new health insurance products to Texas consumers by claiming to be exempt from state regulation. Agents and TPAs are encouraged to carefully review all new products and companies. The National Association of Insurance Commissioners (NAIC) Consumer Insurance Search tool is available as a resource to verify a company’s license, and TDI can answer questions about a company or product at (512) 676-6500.
Those who assist in the procurement of unauthorized insurance could be held liable to the insured for the full amount of a claim or loss, if the insurer fails to pay the claim. Additionally, an agent or TPA’s license may be revoked or suspended in the event that he or she engages in the unauthorized business of insurance.
In the event that a company may be unauthorized or distributing an unauthorized product, notify TDI by phone at (800) 252-3439 or by email at EnforcementInfo@tdi.texas.gov.