DAILY NEWS Aug 24, 2011 4:26 PM - 1 comment

FSCO issues warning of unlicensed auto insurer

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2011-08-24

The Financial Services Commission of Ontario (FSCO) is warning consumers that Lima Automobile Insurance Company is not licensed to do business in Ontario.
In a statement, FSCO said it found that Lima Automobile Insurance Company is collecting premiums from clients without providing coverage.
"Consumers who have been contacted by this company were offered a discount if they paid the insurance premium in advance. FSCO also found that individuals from this company represented themselves as licensed insurance agents and insurers," the statement said.
If consumers purchase insurance from insurers that are not licensed in the province, they are not protected under the Insurance Act and the regulations that govern Ontario's licensed insurance companies, it added.
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harry

The public does not know one insurance company from another. The big question is ," What is the cheapest premium." If they get a low quote they buy. As long as they get a pink slip after paying the premium they are happy. The only time they find out that there is a problem is after they've had an accident and try to put in a claim. This scam has been going on for the many years that I have been in this industry. I would say a bigger problem is brokers/agents who have no authority to bind and sell a policy for a certain company, give the customer a pink slip . The customer contacts the insurer when there's a claim and he is informed that there is no such policy number and they don't deal with that broker/agent. I've handled many claims like that over the years and usually the lawyers and police are involved at a certain point.

Posted August 24, 2011 06:27 PM
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