The Oregon Department of Consumer Business Services (DCBS) forced a $5 million fine on nine American International Group (AIG) insurers for violating several workers' compensation and insurance laws.
DCBS demanded a payment of $1 million within 45 days and has suspended the other $4 million based on AIG's compliance with certain conditions, to which the companies have agreed.
According to the DCBS, the AIG companies were cited for failing to comply with Oregon laws for processing claims of injured workers and reporting proof of insurance coverage. The companies also were found to be using policy forms that were not approved by the state. These forms require DCBS approval in order to protect workers and ensure compliance with Oregon's regulations. The DCBS reported that the recent problems in Oregon came to light following an investigation of AIG's financial statements by state and federal regulators in New York, where most of the companies are headquartered.
To avoid the payment of the additional $4 million, the AIG companies must follow the guidelines of the DCBS order. DCBS Director Cory Streisinger will decide by September 30, 2008 whether to impose or remove the suspended fine amount.
"AIG hasn't lived up to the standards Oregon injured workers are entitled to expect, and it's our job to hold them accountable," said Streisinger, in a release.
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