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Started By
Message
Any insurance agents here?
Posted on 1/1/15 at 12:51 pm
Posted on 1/1/15 at 12:51 pm
Has anyone heard of a MSA (Marketing Service Agreement) in P&C insurance? This is something that is/was used by title insurance companies partnering with mortgage companies to give kickbacks for pushing home buyers to them. Kickbacks are illegal under insurance law but the way these deals were structured it did not violate anything on the insurance side. Recently the CFPB set out to stop these title insurance companies from entering in these bs contracts due to violations of RESPA. I have found plenty of examples of an MSA being used in title insurance but have not seen anything about auto or homeowners. Why do y'all think that is?
4
Posted on 1/1/15 at 1:52 pm to TheDirty1
My cousin had some lawyers draft one up for his P&C operation to use with a real estate brokerage. They ran it past the La. DOI and they approved the arrangement.
Posted on 1/1/15 at 1:57 pm to TheDirty1
.
This post was edited on 1/1/15 at 1:58 pm
Posted on 1/1/15 at 2:00 pm to TheDirty1
The department of insurance just changed all of the regulations on this.
And lots of title companies are about to get hammered. Everyone is ratting each other out and it's gonna be fun to see some licenses get pulled
And lots of title companies are about to get hammered. Everyone is ratting each other out and it's gonna be fun to see some licenses get pulled
Posted on 1/1/15 at 2:04 pm to TheDirty1
Posted on 1/1/15 at 2:13 pm to Mr.Perfect
Don't get your hopes up with the Louisiana Department of Insurance pulling any licenses or fining any title companies. This would reflect negatively on the Donelon administration before NAIC nationally.
This post was edited on 1/1/15 at 2:19 pm
Posted on 1/1/15 at 2:39 pm to ihometiger
I completely disagree.
Ethics enforcement cannot be a negative thing to his naic peers
Ethics enforcement cannot be a negative thing to his naic peers
Posted on 1/1/15 at 2:54 pm to Mr.Perfect
We have had numerous title insurance agents and attorneys over the last ten years incur defalcations in Louisiana but none of those defalcations led to a DOI enforcement action and many of these were criminal acts so if you think the DOI is going to go after something as 'minor' as MSA agreements I have some ocean front property in Arizona for sale. It is all about NAIC stats my friend--100% because the lower the stat the better the regulators think the job you do. It is all about NAIC statistics and to think otherwise honestly is naïve.
Posted on 1/1/15 at 2:58 pm to Mr.Perfect
quote:
The department of insurance just changed all of the regulations on this.
From what I understand, a MSA in its most simple form should be legal. However these title insurance companies are paying an exorbitant amount of money to their affiliates and can't explain how they arrived at a value for the services. As long as the money being paid is actually for services performed and the amount is not dictated by the number of policies bound I don't think anything is illegal about it. I've been wrong before though.
quote:
My cousin had some lawyers draft one up for his P&C operation to use with a real estate brokerage.
Do you know if he used a lawyer in Baton Rouge? (If he's from Baton Rouge) I'm not in the industry right now this is just a side project I am playing with.
Posted on 1/1/15 at 3:20 pm to TheDirty1
There isn't one attorney in Baton Rouge I would trust to write one of these MSAs up. There is one in Louisiana (New Orleans area) who knows what he is doing & who regulators actually trust and there a couple of others out of D.C. who know what they are doing but outside of that you better have an attorney who really knows what they are doing because those agreements need to be done very carefully from my experience. I know several attorneys who have told me the CFPB has even told them to use one of those attorneys to draft the agreement and not to trust anyone else.
And to answer your second question no there is much more that has to be put into those agreements to make them legal federally.
And to answer your second question no there is much more that has to be put into those agreements to make them legal federally.
This post was edited on 1/1/15 at 3:26 pm
Posted on 1/1/15 at 4:04 pm to ihometiger
quote:
There is one in Louisiana (New Orleans area) who knows what he is doing & who regulators actually trust and there a couple of others out of D.C.
Where might I find these individuals? Preferably, the one in New Orleans.
Edit: May have found who you are talking about. Sterbcow Law Group?
quote:
And to answer your second question no there is much more that has to be put into those agreements to make them legal federally.
Absolutely. However, you are speaking in terms of title insurance/homeowners and how the CPFB regulates in regards to RESPA. I am thinking of auto insurance where RESPA doesn't come into play. I am trying to see what it takes to be legal in the eyes of the DOI.
I appreciate the responses.
This post was edited on 1/1/15 at 4:13 pm
Posted on 1/1/15 at 4:22 pm to TheDirty1
Yes that is the name of the firm. Solid reputation.
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