Auto Insurer Ohio Indemnity Is Fined, Barred

In his harshest disciplinary action to date, Insurance Commissioner Chuck Quackenbush fined Ohio Indemnity Co. $325,000 and barred the company from writing auto insurance in California for three years for alleged foot-dragging in paying claims and other abuses.

The Columbus, Ohio-based carrier was the subject of 250 consumer complaints to the Insurance Department over the last two years, spokesman Richard A. Wiebe said Thursday.

John Sokol, an Ohio Indemnity vice president contacted by telephone Thursday, denied any wrongdoing and said the allegations were without merit and “were in a marginally profitable segment of our business.”

Sokol acknowledged that nearly all of the $26 million in annual premiums that the company wrote in California last year are in lines affected by the ban.

Quackenbush said that Ohio Indemnity, which sold auto collision and comprehensive coverage, “engaged in a pattern of claims-handling tactics that were intended to stall and avoid payment of claims.”

Marla Fowler, a former Ohio Indemnity customer from Burbank, said that after an auto accident 2 1/2 years ago, the company rejected her $3,000 claim, contending that it was “work-related” and that the policy covered only “personal use.”

Although Fowler explained that the crash occurred while she was looking for work, and presented documentation, “they just flat denied my claim.”