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Vincent Alexander, appealed the court’s judgment affirming the March 23, 2021 decision of the Louisiana Division of Administrative Law revoking his insurance company license. He appealed and the Louisiana Court of Appeal reviewed the appeal in Vincent Alexander v. Louisiana Department of Insuranceno. 2022 CA 0769, Court of Appeals of Louisiana, First Circuit (February 24, 2023)
FACTS
Alexander was an insurance agent licensed by the State of Louisiana doing business as Vincent Alexander Insurance Agency (the Agency). He was married to Tacey Ann Tolliver, who was also an insurance agent once licensed by the state of Louisiana and worked with him at the agency. Tolliver’s insurance license expired on August 31, 2018.
The Louisiana Department of Insurance (LDI) received a complaint from Kendall Lewis, one of the agency’s clients, filed against Progressive Insurance Company (Progressive). In the complaint, Mr. Lewis that he had paid premiums to the agency on a policy effective December 7, 2018, but the policy was canceled on January 22, 2019. Mr. Lewis provided premium receipts as proof of payment, dated January 2019 to May 2019, signed “T. Alexander.” Progressive informed Mr. Lewis that the policy was canceled due to non-payment, but he did not become aware of the cancellation until he was involved in a motor vehicle accident.
LDI called on Alexander to respond to Lewis’s complaint and explain why Lewis’ insurance was canceled even though he paid premiums. Alexander did not answer.
Representatives from Progressive met with Tolliver at the agency, but Alexander was not present. Tolliver explained to the deputies that she started working there in 1997 and that she and Alexander were the only two employees at the agency. When the progressive representatives asked Tolliver about her expired insurance license, she said she was not aware it had expired.
Progressive, for obvious reasons, terminated Alexander’s producer agreement with the agency, and the agency refunded Mr. Lewis his premium payments and paid his reinstatement fees to the Office of Motor Vehicles (OMV) for not having vehicle insurance.
LDI then issued a Notice of Proposed Regulatory Action and Misconduct via certified mail to Alexander regarding Mr. Lewis’ complaint and the failure to pay the fine. On the same date, LDI sent its intention to suspend and revoke Alexander’s license. After receiving several complaints similar to Mr. Lewis from other clients of the agency, LDI eventually notified Alexander of violations under La. RS 22:1554(A)(4), which provides for the suspension or revocation of an insurance license for “[u]sing fraudulent, coercive, or dishonest practices or misrepresentations, or demonstrate incompetence, unreliability, or financial irresponsibility in business that may endanger the public.”
The Louisiana Division of Administrative Law (LDA) reviewed LDI’s decision and on March 23, 2021, signed an order confirming the revocation of Alexander’s insurance license.
The LDA found that Alexander was particularly irresponsible in allowing Tolliver to run the business after he had become aware of Mr Lewis’ complaints, which then led to other consumer complaints being lodged against the agency. Alexander appealed, and after a full hearing, the district court signed a judgment on November 16, 2021, upholding the LDA’s decision to revoke his license. Alexander appealed to the Court of Appeal.
DISCUSSION
Louisiana Revised Statutes 22:1554(A) allows LDI to take a number of actions, including revocation of license, against any holder of an insurance license issued by LDI who commits any of a number of enumerated actions, which include “demonstrating incompetence, unreliability, or financial irresponsibility in the conduct of such business as may endanger the public. The judgment of the Nineteenth District Court, affirming the March 23, 2021 order of the Louisiana Division of Administrative Law, revoking the insurance license of appellant, Vincent Alexander, is affirmed. All costs of appeal ordered appellant, Vincent Alexander.
LDI properly revoked Alexander’s license. It took too long to do so because the agency, while investigating, defrauded several additional customers by taking premium and not forwarding the funds to the insurer, leading to fully paid policies being canceled due to non-payment of premium. What Alexander and his wife did was criminal and simply revoking their licenses is insufficient and the court should have referred them to the local or state prosecutor.
(c) 2023 Barry Zalma & ClaimSchool, Inc.
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Barry Zalma, Esq., CFE, now limits his practice to serving as an insurance consultant specializing in insurance coverage, insurance claims management, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He practiced law in California for more than 44 years as an insurance coverage and claims attorney and more than 54 years in the insurance industry. He can be reached at http://www.zalma.com and zalma@zalma.com
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