The Florida Office of Insurance Regulation filed papers today asking an appeals court to reinstate its order suspending Allstate Companies from doing business in the state.

The First District Court of Appeal in Tallahassee on Friday temporarily stayed a suspension order issued by Insurance Commissioner Kevin McCarty after the Northbrook, Ill.-based insurer refused to supply material he demanded in a subpoena.

Mr. McCarty asked for a wide range of documents and communications concerning the company's rate setting practices and "improper claims handling processes."

The court granted the temporary injunction, saying the commissioner's order did not mention facts sufficient to demonstrate an imminent threat of irreparable harm to the public interest.

OIR in its motion argued that when the legislature revised the state's insurance law last year it considered a willful violation of the law such as failing to comply with a subpoena was "an immediate threat to the health, safety and welfare" of state residents.

Allstate's failure to provide the requested documents, OIR contended, is a crime under Florida law and "further evidenced a continuing attempt by [Allstate] to improperly subvert, manipulate and undermine the regulatory process. There can be no clearer threat to the safety and welfare of the public than a continuing willful violation of the law."

Mr. McCarty said in a statement that the insurer "has continued to do everything it can to keep from providing the documents requested in the subpoenas sent by my office Oct. 16, so now I am doing everything within my power to ensure that the documents are produced."

"They keep insisting that they are working to produce the documents, but the fact remains that all of the documents were due last Tuesday at the hearing, and they were not there. I also am frustrated that Allstate keeps trying to tell us which documents are relevant to our investigation."

Commissioner McCarty announced Wednesday that he was suspending Allstate from writing new auto business in Florida and then extended the suspension Thursday to keep Allstate from writing any new business in the state.

"Florida consumers deserve to know what is in the documents that Allstate is so aggressively guarding, and my office is determined to get them," he said.

Last week the commissioner abruptly halted a scheduled two-day hearing he called Allstate executives to attend.

He said he did so because company representatives were not prepared to answer questions about the documents that had not been provided and the OIR received 51 pages of objections to the subpoenas.

Allstate has said it continues to provide information to the commissioner, but his motion papers responded that much of what the company provided included items such as prior rate filings, which he already had, documents with missing pages and prior rate filings "falsely marked as 'Trade Secret.'"

Allstate has argued that the commissioner has been on a fishing expedition and had issued the suspension as a "punitive stick." The order, the company said, had harmed its agents' livelihoods, damaged its reputation and would result in higher insurance prices if the carrier is driven from the state.

Special Reports /

Reinstate Allstate Suspension, Regulator Tells Court

Related Stories

Recommended For You