Texas Department of Insurance Do’s and Don’ts with LaJuana Acklin

Transcript

Narrator: 0:00

This podcast is for educational purposes only, does not constitute legal advice and does not create an attorney-client relationship. If you need legal assistance about a legal problem, contact an attorney.

Cimone Murphree: 0:15

Thank you again, ms Acklin, for being with us this afternoon. We are so very excited to talk to you about some of the do’s and don’ts with the Texas Department of Insurance. But first I was wondering if you might be able to take us back a little bit, kind of take us through your journey of becoming the Senior Associate Attorney at the Bertolino Law Firm.

LaJuana Acklin: 0:37

Oh, absolutely so. Prior to onboarding with Bertolino LLP in March of 2023, I practiced administrative law at the federal level. I represented clients before the Social Security Administration and that job was a lot of advocacy for my clients in order so they can receive their benefits. And what I do now is somewhat parallel because, when it comes down to representing clients in front of state regulatory agencies, at least in the very beginning, it is a lot of negotiations and advocacy so we can protect the livelihoods of our clients. But overall, I’ve been practicing for 12 years. I received my licensure in Texas in November of 2011, and it has been quite a journey. Being with Bertolino has been a journey because, although I did practice administrative law at the federal level, practicing at the state level is a different type of entity and a different animal. It takes some of the same skill sets, but you have to build new ones in order to be successful. So that’s what we’ve been doing here is building those tools of success to continue to represent our clients in the best manner possible.

Cimone Murphree: 1:59

I love that you get to continue the advocation for your clients because, yeah, I mean, that’s that’s what we’re doing we. We come in and defend those licenses and livelihoods. It’s you know, we understand that it’s not just that piece of paper, that certificate, a card, a title.

LaJuana Acklin: 2:19

That’s your career, your livelihood right, absolutely, and I think I didn’t do a lot of criminal law prior to onboarding with Bertolino, but that’s where the parallel comes in with criminal law Criminal attorneys. They defend and protect the livelihood of that person. We essentially do the same thing when you’ve worked 12, 15 years to obtain an insurance license or your physician’s license from a testes medical board. That is what you know, that’s all you know, that’s what you’re trained to do, and to lose that or to have that at risk really puts your entire life at risk. So when someone boards with our firm, they’re putting their lives in our hands and we are responsible for that life because they’ve been trusted that with us.

Cimone Murphree: 3:08

It’s, like you said, a niche area of law and it takes an expert to be able to decipher, interpret and defend Absolutely In addition to that, to also stay on top of all the rules and regulations that are going, because you have to be ahead of the curve so you can help assist the clients even better.

LaJuana Acklin: 3:30

Absolutely. That’s an excellent point because things are constantly changing. The legislature gives the power to these regulatory agencies to govern the license holders and to protect the public and put in laws and regulations for that particular license. So there’s constant change and we’re tasked with knowing that change, keeping up with it so we can protect our license holders. The regulatory agency protects the public. We’re tasked with protecting the license and to do that you have to be abreast of all the changes.

Cimone Murphree: 4:05

Ms Acklin, you had previously said, I think in an unrecorded conversation, that you really enjoy working on these TDI cases.

LaJuana Acklin: 4:17

I do, I do and just for everyone, tdi stands for the Texas Department of Insurance and we handle a lot of those cases in our office. We represent insurance agents when they receive a complaint from the Texas Department of Insurance and we help them navigate that process and it is out of everything we do and we do a lot here in the office. It is probably my favorite area that we practice in.

Cimone Murphree: 4:44

Can you explain a little bit more for our viewers or listeners, Ms Acklin, as to why you enjoy working with TDI cases?

LaJuana Acklin: 4:51

Oh, absolutely Outside of it. Just being interesting, dealing with insurance is something that is connected to everyone. Everyone has some sort of insurance policy, whether it’s an automobile policy, life insurance, some sort of insurance policy, whether it’s an automobile policy, life insurance, health insurance. It connects to everyone, but everyone may not know the ins and outs and what it takes to make sure that the insurance industry is regulated. And that’s kind of where we step in. We work with the license holders, the individuals that sell us that insurance, and it’s just super interesting the types of law and the areas that we deal with when it comes down to what individuals may complain about, what may arise and the types of cases that we get. Is it just runs the gamut of the facts and where this will go within the insurance industry.

Cimone Murphree: 5:48

You mentioned. You know some of the. You’re seeing some kind of patterns in. You know complaints and things that license holders, may you know, get in trouble for. Can you kind of elaborate on a little bit of those?

LaJuana Acklin: 6:08

Sure, sure, sure.

LaJuana Acklin: 6:09

So I’m going to step back and then I’m going to come back to your question.

LaJuana Acklin: 6:10

So, of course, with the Texas Department of Insurance, they are the regulatory agency in Texas that is tasked with regulating our insurance agents, the individuals that sell us our policies, often within their regulation, and the cases that we see, majority of them, have to do with fraudulent acts or practices or engaging in dishonest acts and the complaints that may arise from those With that.

LaJuana Acklin: 6:39

The majority of those cases within that guise comes down to submitting fictitious or altered documents in order to get a discount on a policy which can harm the actual insurance carrier and the money that may have been due to them. They may not receive that because the discount is not warranted for the customer. So that’s a lot of what we see and with those there’s some nuances as to what is actually a fraudulent or dishonest act versus something that just may be a mistake or negligence. One is actionable under the Texas Department of Insurance regulations and another one is not. So it’s my task as a lawyer to look at the case so I can decipher which is which and that’s how we’re able to help our clients.

Cimone Murphree: 7:35

Gotcha. So is there, do you see? You’re saying there’s a fine line between something that could be considered, you know, an actionable offense versus something that could be considered, you know, just a simple oversight or mistake.

LaJuana Acklin: 7:51

Absolutely. So let’s deal with what we’re talking about with this fraudulent acts or engaging in dishonest acts or practices. This fraudulent acts or engaging in dishonest acts or practices. So you have some things that are just black and white. You alter the document, you submit it to an insurance carrier and that’s the end of it. The ball stops there. But then there are these nuances within the case. That’s like well, let’s look at this. I can give you an example.

LaJuana Acklin: 8:18

If there is a document that’s submitted but the person that has been accused of submitting it actually did submit it and they can prove that someone else submitted it and was not within their consent, now that’s not a fraudulent or dishonest act on behalf of that person and we can use those facts to get that individual outside of their violation territory and protect their license.

LaJuana Acklin: 8:44

There are some instances in which you have these documents, but they have the proof behind the documents to submit. Yes, we created our own document, but this is where we created this document from. And here are those base level documents and we can send that to the Texas Department of Insurance. And again, I’ve done my job as a lawyer to protect my client and their license. And just a little bit about Texas Department of Insurance there to make sure that the public doesn’t have incurred any harm. But in those instances we get the best of both worlds. The public is still protected, and then we still have an individual that’s an asset to the insurance industry. They still get to keep their license and they still get to go forth in a career that they’ve worked hard for and that they love.

Cimone Murphree: 9:42

We love to hear those success stories, but it sounds like it takes a lot of finesse. It sounds like you really need someone who is well-versed in working with the Texas Department of Insurance, but more so you know they’re familiar with working with them, but more in the capacity of licensed defense, like you said, because it can take a little bit of work to kind of, you know, maybe steer the case on one side versus the other.

LaJuana Acklin: 10:14

Absolutely so. If you have a license, you’re an agent, or even if you’re an entity that’s licensed to engage in the business of insurance in Texas and there is this investigation or complaint that’s been filed against you with the department, the first thing you typically get is what is called a 38.001. That is the department and the investigations unit just asking questions to see, okay, what happened? Is there any teeth here to what may be alleged? Right, it’s so important to bring someone in a practitioner that does what we do because this is a niche practice of law that knows how to navigate the Texas insurance code and their statutes and their regulations, Because if you don’t, one of the things that I see in the office a lot is when an agent gets one of these inquiries, they try to handle it on their own and then they make an admission or they make a statement that can be used against their interest. So, yes, when it comes down to knowing and being able to know those nuances and to be able to siphon out what may be one disciplinary action, what may not, you need someone that is well-versed in it.

LaJuana Acklin: 11:32

Typically, that’s not the agent when it comes down to having a professional license, and this includes the Texas Department of Insurance and our insurance agents. You know how to obtain your license. You know how to do your education credits and keep up with all the compliance stuff to keep your license. But oftentimes they don’t know what to do if they can go down the rabbit hole of possibly being in trouble and losing a license. This is where obtaining an attorney early on is pivotal, because we also help with crafting a particular statement. You never want to tell any type of fibs or fabricate or mischaracterize anything with a regulatory agency, but what you do want to do is properly characterize the facts that are in your favor, and that takes a skill attorney to do so.

Cimone Murphree: 12:27

Can I also note that it’s important for our viewers and our listeners to know that this type of inquiry does come via mail. So everyone needs to pay attention to their mailbox because also with this letter you’re also associated with deadlines. Can you explain how those deadlines come into play as well?

LaJuana Acklin: 12:45

Oh, absolutely. That’s an excellent question. So you are absolutely correct. Regulatory agencies still use snail mail. Even if you don’t check your mail, you should always check it because you do not want to ignore what’s coming in the mail.

MJ Hooper: 13:00

And that’s not a good surprise either. Never.

LaJuana Acklin: 13:02

It’s never a good surprise. But going back to your point about having deadlines, yes, there are deadlines associated with these infamies. Typically it is a 15-day deadline. So from the time that you receive it and not when you receive it in your hand and you check your mailbox a month later, but that trusty, dusty date that’s on the actual letter by 15 days from then you need to submit an answer to that inquiry or it could result in further disciplinary action or you leave all the power into the department’s hands to make whatever decision they want to make with whatever they have.

LaJuana Acklin: 13:41

So it’s very important that you pay attention to those deadlines. Also, they know they’re working with the public and they want to give you a chance to respond. So when you receive it, if you need more time to answer those inquiries, you can automatically get a 10-day extension. So it’s very important to make sure you’re checking your mail. You know if they send something by email. You’re checking all of your avenues so you’re not missing anything, so you can comply with what’s being sent to you from the department.

Cimone Murphree: 14:14

And somewhat of a piggyback off of that. As a license holder, it’s your responsibility to keep your address updated and to make sure that the agency has your most updated information so that they can reach you in the event that you know there’s a notice that needs to be sent out. You want to receive that in a timely manner. You want to receive that in a timely manner. So for our license holders or viewers who want to be licensed, make sure you’re keeping your contact information with your agency updated.

LaJuana Acklin: 14:49

Oh, absolutely, I think that’s an excellent point. A last known address and a current address can be two different things. If you do not keep them abreast of your current information A you’re required to do so. B if you don’t, you will miss those important inquiries and deadlines which can lead you further down a rabbit hole of disciplinary action. And then it’s just important that you always want to keep up with whatever the department asks you, because you work hard for that license, and little things like not keeping up with your current address and updating the department with those vital that vital information can lead you into a rabbit hole. That’s unnecessary. So yeah, that’s super important.

Cimone Murphree: 15:34

I think that’s an excellent point Just receiving a notice from the department, whether it’s complaint or violation. Can you kind of take us through what are some important factors that the agency might consider in making a decision?

LaJuana Acklin: 15:52

Ooh, that is an excellent question. I’ll tell you based on my experience and what I’ve seen with these cases my experience than what I’ve seen with these cases. Typically it starts with an internal investigation that an insurance carrier may have conducted on their own. And I’ll give you an example. This is just a hypothetical. Let’s just say we have an insurance agency and we have agents and there’s been some discounts given on homeowners policies and then they have to submit certain documentations to get those discounts. Well, the insurance carrier comes in and they do an audit once a quarter. Once they do that audit they see something. Oh, something is not right here. Something is not like the other. Let’s go in and do our own investigation. Well, within that investigation they find out okay, something is really not up to snuff. So two things happen here. They A can terminate the appointment for the agent to sell insurance with their carrier. Then, b, all the information that they gather and what they use to come to their conclusion, they can turn it over to the Texas Department of Insurance. Turning that over often starts that ball to rolling.

LaJuana Acklin: 17:10

And typically, once you receive a notice from the Texas Department of Insurance, that 38.001 entry, that’s usually like the first document, the investigator will send you something in the mail. Sometimes they may even email you and say okay, here’s the complaint, there’s basically been a complaint against you, or we’ve opened a complaint against you. We need answers to these questions. Once their investigation has concluded, one of two things will happen. Either they’ll close it and say you know what? There’s nothing here, we’ve done our due diligence and we don’t think anything warrants disciplinary action. Or it can go forward and they can issue charges and say, based on the information that we have, including your side of the story when you answer these, these inquiries, here’s what we think happened. Okay, and then it can go to their, their legal team, from the investigatory team, and then it can go from there.

Cimone Murphree: 18:02

So it sounds like essentially, in the very beginning, there could be an internal investigation being done without the license holder even knowing that this is happening or that there’s being an investigation conducted because they’re going to be asked questions.

LaJuana Acklin: 18:23

If the insurance carrier comes in and say, hey, what’s going on here, then of course they’ll be inquired by that insurance carrier. Then they’ll make their determination and then they’ll turn it over. And I want to go back to something because I mentioned a term appointment. So in Texas each insurance agent must have an appointment with the insurance carrier and those appointments are reported by the insurance carrier to the Texas Department of Insurance. So the department knows not only do you have a license, but they know each carrier that you are appointed and you can sell their insurance product. If that carrier terminates your appointment for a cause, they will also report that.

LaJuana Acklin: 19:06

Again, going back to that internal investigation, it kind of strings together and that can lead to that initial complaint with the Texas Department of Insurance. That’s not the only way. Consumers can also complain as well. So even if it’s not an internal investigation and then a consumer feels like they were wronged by insurance agency in some way, they can file a complaint as well. And you can go right up to the Texas Department of Insurance website and you can place a complaint and that can also start an investigation. I’ve seen in this office where you have the sale of automobile policies right, and then the person that bought the automobile policy felt like something wasn’t up to snuff and as a result they filed a complaint against the individual that sold them the policy. So it’s more than one way in which those investigations may start, but the majority of cases that we’ve had it typically starts where there was an internal investigation with an insurance carrier and then it kind of carried over to the department.

Cimone Murphree: 20:21

You know you are, you have reached, you know your investigation has been turned over to the legal department. Can you tell us a little bit about what happens from there?

LaJuana Acklin: 20:38

Absolutely, and it kind of goes back to our conversation before. So you have the enforcement unit and then you have the legal. Everything starts with enforcement. That’s where the investigators which are not attorneys they do the due diligence to get all the information to make a determination whether or not a violation occurred. I can tell you firsthand those investigators are very thorough. So, going back to the example I gave you regarding discounts, right, if you submitted invoices and saying, hey, this is who didn’t work in order to get this discount, I can tell you those investigators would call every person that you have listed. And that’s how thorough they are to come up with their determination.

LaJuana Acklin: 21:18

Okay, so let’s go back to that. Let’s say the enforcement the investigator, they work with you, they get your information, they get your documents. They talk to say the enforcement the investigator, they work with you, they get your information, they get your documents. They talk to all the stakeholders, they talk to the insurance carrier and anyone else that they can contact to get their information. Okay, then they compile that, they look at everything and they say, okay, this is what we think happened. Then they would take that to their boss and say, hey, director of enforcement, this is what I think happened. Then they would take that to their boss and say hey, director of enforcement, this is what I think happened. Either we can close this or this needs to move forward.

LaJuana Acklin: 21:52

And in a lot of my cases I’ve received what are called warning letters, meaning that we can’t quite prove you did something, but because we can’t, we’re going to go ahead and we’re going to close this out. And a warning letter is a non-disciplinary action. So when a client gets a warning letter, it’s a great thing. It’s not going on the record. You can’t pull an order. It’s just say hey, this is a slap on your hand, make sure you’re careful next time. So that’s the first part of it.

LaJuana Acklin: 22:18

So let’s say that they do think some violation is warranted. They will send the license holder a proposed order of what they think the violation should be. You can accept or you can reject it. Ok, if you accept it, that means that you accept whatever disciplinary action and the enforcement part of it ends. However, if you feel like none of this is true and you want to fight it, then they transfer that case out of the enforcement department to the legal department and then it’s assigned a staff attorney and then, if you have an attorney. We can still work with that staff attorney because technically it’s still in the investigative phase. Can’t work anything out with the staff attorney, then that’s where jurisdiction detaches from the texas department of insurance and they file a case with the state office of administrative hearings.

MJ Hooper: 23:12

That’s where we go to trial at that point and miss ackman, isn’t it true with the proposed orders? There can be times where, yes, the proposed order gets um issued, but you can negotiate the verbiage or the language on it to meet the needs.

LaJuana Acklin: 23:30

Oh, I’m sorry. Yeah, well, that’s absolutely true. So even if you receive the proposed order and then you can work with the staff attorney, then you can’t will some of that language or even a staff attorney. You take it to them and you state your position by the staff attorney. You take it to them and you um state your position by the staff attorney. You know, knowing the law and they know the facts and they could apply a legal perspective, then you may have a better chance of getting a better result so don’t get discouraged, don’t get discouraged.

MJ Hooper: 24:00

If you get a board order or a proposed order, it doesn’t mean it’s a final thing yet exactly absolutely, and it’s not final until there’s a final order.

LaJuana Acklin: 24:06

Especially, it doesn’t mean it’s a final thing yet, absolutely, absolutely, and it’s not final until there’s a final order, especially if you go all the way to SOA. Even then it’s something called judicial review, that now you can go into the actual course and file it. So nothing is final until you exhaust all your legal remedies. But you are correct, you can still work with a staff attorney to see if you can get a different result.

Cimone Murphree: 24:29

I’m going to say I know I work here, but I feel like that just really solidifies a case for why it is so important that you have an expert who has the knowledge on your side, because a lot of license holders and some of our viewers who are watching right now may have, just, you know, had a light bulb go off and go. Oh my gosh. You know it isn’t as black and white as it looks at face value. So it’s, you know, again, super important. Consult with an attorney, hire an attorney, talk to an attorney. An attorney hire an attorney. Talk to an attorney.

LaJuana Acklin: 25:04

Yes, and just to build upon that point, the importance of obtaining an attorney. We receive these 38001 inquiries, especially if the allegations are fraudulent or dishonest acts. Oftentimes the investigator will also attach what is called a voluntary surrender and it basically will say either you can answer these or you can just give up your license. And if you’re not well-versed you will think, oh my God, they’re going to take my license, which it may give you some sort of anxiety. It means you have to make a choice that you technically do not have to make Getting an attorney. They can explain to you. This is just an attachment, this is something you do not have to exercise. See the process out.

LaJuana Acklin: 25:55

There may be some arguments. Contingent on what happened and what we can prove happened, you may be able to remove yourself totally out of the violation territory. If we can show that there was some negligence here or there was just a mistake, you may be able to save your license. I wouldn’t just give up your license just because they attached that voluntary surrender form, because if you sign that, that is a separate contract. Not only do you give up your license, you are barred for five years before you can reapply and the department will take that into consideration if you reapply in five years. So you don’t want to lock yourself into that without having proper legal counsel.

Cimone Murphree: 26:42

Yeah, and I know for for license holders that receiving that letter, that notice, especially when it’s got that voluntary surrender attached, it’s confusing, it’s scary. You know your immediate reaction is to, you know, kind of freak out about it and definitely justifiable to have that response. But it’s also okay to take a second to kind of get your ducks in a row and emotionally come down from that to really think about what’s the best option for me in the long run.

LaJuana Acklin: 27:20

Absolutely, absolutely, because the best option may be to fight this, especially and this is a big do when it comes down to having a license records retention. The better your record keeping is, the better chances you will have if you receive one of these inquiries or some sort of consumer complaint. To answer it, you may have all of your ducks in a row from a record keeping perspective to show a the allegations are flat out baseless, or even if there is some merit. Here’s why you can pursue this and we can show that. So a big do I know we’re supposed to talk about some dudes here. That’s a huge do.

LaJuana Acklin: 28:01

Get in a turn early on, do not wait. Be in the course of business, keep your records. As a matter of fact, you will see if you. Hopefully you know whoever’s listening to this. They don’t receive one of these inquiries, but one of the things you will receive if you do get one is this business records affidavit. That’s proof positive there. They want to see your records and you have to be able to attest that these records were kept in the course of business. If they’re asking for specific things, you want to have that so you can attest. Hey, not only do I have this. I can attest that I kept this throughout the course of my business, and it will just help you to navigate the process.

Cimone Murphree: 28:41

What about some don’ts? What are some hard no’s for dealing with the Texas Department of Insurance? How much time?

LaJuana Acklin: 28:50

do we have today? How much time do we have? A hard no is A not getting an attorney early on? Oftentimes we see in our office that people come very late to the party. The lights are turned out, there’s no more music, there’s no more dancing. Get an attorney early. Two do not make any statements without the advice of counsel. So that means A you have to get your attorney. B don’t make any statements without that counsel. Because what can happen? If you make a, if you make a statement, if you make an admission to any type of conduct? That’s actionable. That’s it. It’s very hard for us to undo whatever, ever, anything that you say to the department that’s against your interest, anything that you say to the department that’s against your interest. So don’t make any admissions, don’t make any statements against your interest.

MJ Hooper: 29:52

Especially lies. Do not lie, it does not pay for it. It doesn’t go well.

LaJuana Acklin: 29:59

It definitely doesn’t go well and I have seen firsthand where cases were going very well until the investigator called individuals listed on, documents turned in, and then we get a call in our office requesting a meeting not only with the investigator but two of their attorneys. So, yes, do not lie. Do not lie to your attorney. Attorney-client privilege exists for a reason. If you tell me that you have two bodies buried in the backyard from 1965, I can’t say anything. So you have that safe space because the more information you give your attorney, the more information you have to help you.

Cimone Murphree: 30:45

Well, Ms Acklin, thank you so much for giving us some of your time this afternoon. We have really enjoyed getting to talk to you about really these intricate pieces of the Texas Department of Insurance.

LaJuana Acklin: 30:59

Yes, yes, texas has the most stringent insurance laws in the country and it is very voluminous. It’s nuanced. That’s why you need an attorney who’s well-versed, who knows the Texas Insurance Code and can help you use those laws in your favor. Again, the Texas Department of Insurance is not the license holder’s friend. It is there to protect the public, us as attorneys at Bernalino. We’re here to protect you.

Narrator: 31:31

Empower your professional journey. Know your regulator. The podcast that inspires you to engage.