2 insurers in Texas lead agency complaints

AUSTIN, Texas (AP) - The Texas Department of Insurance is investigating two auto coverage companies that topped the state's list of consumer complaints last year, The Dallas Morning News reported Tuesday.

Complaints against Loya Insurance and Old American County Mutual included delays in processing claims, unsatisfactory offers or settlements, denial of claims and liability issues, according to the newspaper's analysis of department figures.

Both had "justified" complaints well above the 2009 average as compiled by the state.

The insurance department "has pending enforcement cases" against Loya and Old American, department spokesman Ben Gonzalez said. He said he could not discuss the Loya case, but released documents indicating Old American has been cited for canceling hundreds of auto policies after claims were filed.

The company said the policyholders made false representations in applying for insurance, according to state documents examined by the newspaper.

Loya, which collected more than $283 million in premiums last year, performed nearly four times worse than a typical Texas insurer, according to the state-calculated "complaint index."

Edgar Meza, vice president of claims for Loya, said many of the complaints stemmed from differences over the market value of vehicles and vehicles not covered by the company.

Complaints against Loya, which typically serves lower-income drivers who have trouble obtaining insurance, are down in 2010 and the company takes such complaints seriously, Meza said.

Old American County Mutual, a Dallas-based company that collected nearly $539 million in premiums, had a complaint index more than three times worse than a typical company.

Old American did not immediately respond Tuesday to a message from The Associated Press seeking comment.

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