Allied Property and Casualty Insurance and six
affiliated companies have agreed to pay a $50,000 penalty to the state
of Iowa for overcharging on more than 1,700 Iowa auto insurance
policies.
According to the Business Record, the insurance companies violated the Iowa Unfair Trade Practices Act and the Iowa Casualty Insurance Act by making coding errors that caused the
companies to overcharge on policies that featured "accident forgiveness."
The issue came about in 2009 when the Iowa Insurance Division
investigated a complaint from a policyholder.
When Allied and other companies in the Nationwide group looked into the matter, they found there was an error in manually coding a
"chargeable accident" that should have been under the threshold to
trigger a rate increase.
Refunds totaling nearly $383,000 were made to 1,721 policyholders earlier this year.
