Staffing issues result in sanctions for agency, nominee and agent

S&S Insurance Services (Surdel) Ltd. and its nominee, Daljit Singh Sidhu are the subject of a pair of intended decisions handed down by the Insurance Council of British Columbia in July and August 2023.

High employee turnover, and a miscommunication of roles and responsibilities, along with senior management’s efforts to resolve a situation internally “for the sake of a past business and family relationship,” were all cited in the first intended decision, where Sidhu was reprimanded and ordered to complete coursework, while the agency was fined $7,500 and assessed council’s investigation costs in the amount of $2,468.75. 

Specifically, in September 2021, the insurance council was told by a former general insurance licensee, known as YS in the decision document, that he was surprised to learn that his license had been terminated in August 2020 for non-renewal. At the time, YS indicated that they’d been continuously practicing, as they believed they were licensed. YS also held an authority to represent (ATR) the agency until his license was terminated in August 2020 for non-renewal. The agency in September 2021 admitted they were unaware the agent was unlicensed, as their licensing and compliance officer had resigned in January 2021. During the investigation, that employee, however, said they were only responsible for renewals of individuals working in the office. YS, being a producer, was not part of their responsibilities.

More, YS was terminated in May 2021 but the agency failed to revoke the agent’s ATR with council. YS had reportedly been terminated for collecting premiums and not forwarding the funds to the agency.

“Council noted that YS’s conduct was brought to the agency’s attention in May 2021 and appeared to have occurred between January 2020 and May 2021. It is important to note that during the period from August 2, 2020, to May 2021, YS continued to work at the agency while unlicensed,” the intended decision states. “The senior management team hoped to resolve the situation internally for the sake of a past business and family relationship, but with hindsight, they were aware that the conduct of YS should have immediately been reported to council.” 

They add that the agency was dealing with high employee turnover in 2020 and there was a miscommunication of roles and responsibilities. “The nominee (Sidhu) acknowledged that the agency should have reported the withdrawal of the ATR immediately to council. However, the agency, focused on their own internal investigation of the matter and ensuring that all misappropriated funds were returned.” 

In a completely separate decision, Sidhu was fined another $1,000 and assessed investigation costs in the amount of $1,062.50. The agency was also fined $1,500 and its agent, Amrit Singh Sidhu was fined $5,000 and had their license downgraded after another staffing issue was partly blamed for circumstances which left one client without insurance for nearly a year.

With the agency since September 2007, Amrit Sidhu, also the agency’s life nominee, was reminded by an insurer in October 2020 that a client’s policy was due to expire in December that year. A quote was provided in November and in December an agent advised the insurer that the client wished to bind coverage. The client was charged premiums, which were paid to the agency.

The insurer had not provided confirmation to the agency that the policy was in force. The agent who advised the insurer that the client wished to bind coverage also left the agency. “The agency believed the policy had been renewed because of an entry made by the former agent of the agency noting that the policy was renewed,” they state in that intended decision.

Although Amrit Sidhu was told in January 2021 that there was no coverage in place and told the same in November 2021 when the client attempted to make a claim, the issue was still not identified until January 2022 when a different agency requested a quote from the same insurer for the same client, believing that the policy in question expired in December 2021.

The agency, meanwhile, didn’t refund the client’s premiums for the December 2020 policy until March 2022.

In the intended decision, the insurance council says the nominee (Daljit Sidhu) and the agency failed to properly manage the business and financial aspects of an agency by not properly handling and remitting premium money. Council added it is also “’concerned with the licensee’s inability to remedy the situation when he was notified on at least two occasions that the client did not have coverage.”