A unit of controversial Long Island insurance broker Waldorf & Associates will operate under the supervision of Pennsylvania regulators for five years, according to the state’s Department of Insurance.
State regulators found that Waldorf Risk Solutions brokered roughly $2.2 million of business in 200 policies of a specialty type of property and casualty insurance, called surplus lines policies, between 2005 and 2010 — despite not receiving a license to do so until Nov. 30, 2009, according to a consent order entered into between the two parties.
As a result, the family-run outfit in Huntington, NY, which sells insurance mostly to Catholic schools and charities, will pay $72,600 in restitution and fees to the state, according to the order, which was entered into on Nov. 14, 2012, but made public only recently.
“The supervision is much like probation,” said Melissa Fox, a spokeswoman for the state regulator. “Business practices are monitored, and if other violations of Pennsylvania law occur during the supervision, the department has the authority to suspend the license.”
In agreeing to the five-year supervision, Waldorf didn’t admit any wrongdoing.
Waldorf’s Pennsylvania policies were obtained from a foreign company, Lloyd’s of London, the order said. At least five other states — Louisiana, Connecticut, Delaware, New Jersey and Florida — are probing the broker for similar behavior, officials in those states confirmed.
In 2011, Waldorf paid $3.4 million to New York insurance regulators to settle a probe into its failure to pay tax on surplus lines policies issued here over 15 years.
Waldorf for decades sold foreign insurance from Lloyd’s to more than 300 Catholic charities, schools and social service agencies, including two of the largest charities hired by City Hall to help the city’s needy.
Surplus lines insurance policies are not backed by state insurance guaranty funds, since the companies selling them are ordinarily out of state or out of the US.