Maryland Commissioner Fines Liberty Mutual Companies

Maryland Insurance Commissioner Ralph Tyler announced an administrative action against certain Liberty Mutual companies for failure to issue proper notices of proposed rate increases to consumers. Liberty Mutual was fined $25,000 and returned nearly $450,000 to consumers as a result of sending these improper notices.

“The MIA received a series of complaints and contacted Liberty Mutual about the problem,” said Tyler. “The company cooperated in identifying that there was a computer error, fixed the problem and agreed to the sanctions we imposed.”

More than 800 notices were issued by Liberty Insurance Corporation, Liberty Mutual Fire Insurance Company and The First Liberty Insurance Corporation between Nov. 15, 2007 and March 6, 2008 in which the companies failed to include the name of the driver that contributed to the increase as required by Maryland law. State law provides that any error or omission in such premium increase notices makes the notice invalid and prohibits the carrier from collecting the increased premium amount. Refunds are made with interest to the complainants and all other affected customers identified by Liberty Mutual.

“This is an excellent example of what the MIA as a state regulator should be doing to protect
consumers who may not have even known there was an error,” said Tyler. “Consumers should
know that this agency is looking out for them.”