California-based insurer Trans World Assurance, investigated in 2008 for allegedly violating state regulations in its dealings with military personnel, has surrendered its certificate of authority to operate in Georgia.
State Insurance Commissioner John W. Oxendine announced Wednesday that he has signed a consent order with TWA, signaling the end of a two-year legal battle.
Oxendine issued an order in 2008 fining the company $214,000 and requiring it to cease its operations in Georgia. The company was also ordered to refund monies collected from active duty military personnel related to life insurance products it has sold in Georgia since September 2007.
TWA has since refunded $145,563 to affected policy holders.
“The egregious actions by Trans World Assurance left me with no other option but to revoke their right to operate in the state,” Oxendine said in a release. “They will never again take advantage of the men and women in uniform stationed in Georgia.”
In a hearing held in May 2008 to investigate allegations that the company sold a life insurance policy containing an illegal component to military personnel between September 2007 and March 2008, the commissioner found that provisions of the accumulated fund in its "Flexible Dollar Builder" product violated Georgia's Military Sales Practices Regulation and the Unfair Trade Practices Act.
The company further violated regulations by selling life policies to service members already covered under Service Members Group Life Insurance (SGLI) without making the required assessment to determine whether the service member needed additional coverage, Oxendine said.
Although the company may not sell new policies in Georgia, it must continue to service existing contracts which were sold before September, 2007.