Insurance Commissioner Mike Causey today announced that two insurance companies, Builders Mutual Insurance Co. and Builders Premier Insurance Co., agreed to a voluntary settlement agreement following a market conduct compliance examination.
Builders Mutual, the parent company, and Builders Premier, a subsidiary, agreed to pay $39,000 because of repeat violations. In addition, Builders has issued refunds to policyholders totaling $869.80, including interest, because of a rating error.
The companies are licensed to write commercial lines insurance policies in North Carolina.
The market conduct examination found that Builders Mutual and Builders Premier failed to obtain two forms of reliable proof of North Carolina residency or eligible risk status, a key means of determining appropriate insurance rates, in 34% of the policies randomly selected for review.
The examination also found four instances of delays out of 50 randomly selected claims in reimbursing customers for deductibles when Builders filed subrogation claims against other insurance companies for damages. Additionally, out of 19 randomly selected non-renewed policies, two customers were not given precise reasons for the non-renewals.
Builders Mutual entered into a voluntary settlement agreement with the Department of Insurance and agreed to provide the Department with a corrective action plan to address the violations.
“I want to thank the members of the Department’s Market Regulation Division for their diligent work in reviewing insurers’ records,” Commissioner Causey said. “I, along with the Department’s employees, remain committed to making sure that insurance laws and regulations are followed.”
The examination began on Jan. 16, 2024, and concluded on May 29, 2024. It covered the period from July 1, 2021, through Dec. 31, 2022.
The fine will be dispersed under provisions of the N.C. Constitution for the benefit of the public schools.