Order to Cease and Desist, Final Order Assessing Civil Penalty and Consent to Entry of Order
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Final administrative order resolving enforcement action by the Oregon Division of Financial Regulation against John Hancock Life Insurance Company (U.S.A.) for incorrect calculation of long-term care/home health claim benefits and delayed claim responses; it affects the named respondent and pertains to Oregon insurance regulations.
No material clinical or coverage changes in this revision.
Regulatory Findings and Violations
Regulatory findings, violations, and remedies
Regulatory requirements and findings applied to the respondent's claim handling:
ALL of the following
- Occurrences: 21 documented occasions as described in Findings paragraphs 2A–2U
See Findings and Conclusions identifying 21 violations of ORS 746.230(1)(a).
ALL of the following
- Occurrences: 122 documented occasions between August 29, 2014 and September 6, 2015
Respondent provided data showing 122 failures to respond within 30 business days; violates OAR 836-052-0770(2).
ALL of the following
- Civil penalty assessed totaling $71,500 with $35,000 suspended subject to compliance and a three-year no-new-enforcement condition
Portion of civil penalty suspended contingent on compliance and conditions; penalty details in Order.
- Penalty amount due and payable: $36,500 upon return of the Order to the Division
Portion not suspended is immediately payable.
- Director orders respondent to cease and desist from violating the Insurance Code and related administrative rules
Cease-and-desist order issued by the Director.
- Respondent refunded monies owed to claimants listed in findings (paragraphs 2A–2U)
Refunds were made on or before April 22, 2014 as described in Findings.
- Suspension condition: suspension of part of penalty is contingent on compliance and no enforcement actions for three years from effective date
Suspension subject to compliance provisions specified in the Order.
- Respondent consented to entry of the Order and waived right to hearing
Respondent consented and waived hearing rights as part of the Order.
ALL of the following
- ORS 746.230(1)(a) cited for misrepresentation prohibition
Used to support findings of misrepresentation in claim settlements.
- OAR 836-052-0770(2) cited for 30-business-day claim response requirement
Supports findings regarding failures to respond to claims.
- ORS 731.988(1) cited as statutory basis for civil penalties up to $10,000 per violation
Authorizes imposition of civil penalties by the Director.
Statutory Citations and Penalty Details
| ORS 746.230(1)(a) | Prohibition on misrepresenting facts or policy provisions in settling claims |
| OAR 836-052-0770(2) | Requirement to respond within 30 business days after receipt of a long term care claim |
| ORS 731.988(1) | Authority to impose civil penalty up to $10,000 per violation |
Orders and Required Actions
Cease and desist from violating Insurance Code and rules
The Director orders the respondent to cease and desist from violating any provision of the Oregon Insurance Code or the administrative rules promulgated thereunder.
Key Definitions
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