Allstate challenges Fla. Insurance commissioner

By Legal News Line | May 20, 2008

Kevin McCarty

TALLAHASSEE, Fla. (Legal Newsline) – Allstate is asking the Florida Supreme Court to review a lower court's decision suspending it from selling insurance in the Sunshine State. Allstate argued to the high court that the First District Court of Appeals' erred when it upheld the actions of the state insurance commission, which last week suspended Allstate's authority to write new insurance policies in Florida. The lower court had declared the insurer's right to due process had not been violated when the Florida Office of Insurance Regulation temporarily suspended it from selling insurance policies. Allstate called that a "conclusion" that was "contrary to due process," as well as violating requirements of state laws, and the state and federal constitutions. In a brief filed Monday, Allstate argued, "a judicial determination of objections and privileges are required before an administrative agency can enforce its own subpoenas." The insurer also argued that the appeals court created a "relaxed standard" when it had concluded that the Florida Office of Insurance "could self-enforce its subpoenas instead of pursuing enforcement in circuit court." "First DCA's decision expressly and directly conflicts with the decisions of two district courts of appeal and with two decisions of this Court," Allstate attorneys said in the brief. The problem occurred when Allstate Floridian Insurance Co. didn't comply with subpoenas for documents from Florida Insurance Commissioner Kevin McCarty. Allstate's refusal to comply meant it should be barred from writing new insurance policies in the state, McCarty said, and the First District Court of Appeal agreed. However, McCarty's insistence the company comply with its subpoenas without a circuit court order denied Allstate its fundamental due process because a judicial determination was required before an administrative agency, such as the Florida Insurance Commission, can enforce its subpoenas for documents, Allstate said in the filing. After Allstate was suspended from writing new policies in Florida last week, McCarty stayed the suspension after Allstate filed an affidavit with McCarty saying it had given the insurance commission's office all the documents it requested. Although the stay allowed Allstate to resume writing insurance policies in Florida there is no guarantee the state will allow it to continue doing so. From Legal Newsline: Reach reporter Lin Young at

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