Unlicensed Auto Insurance Robo-Caller Fined $191K by Minnesota Regulators

An unlicensed commercial entity has been ordered by Minnesota commerce regulators to pay $191,185 in civil penalties for making fraudulent and unlicensed auto insurance solicitations to consumers in that state.

The Minnesota Department of Commerce imposed the fine on Variable Marketing, a Texas LLC, which does business under the name Instant Insurance Marketing.

The commerce department said Variable Marketing is not licensed to sell insurance in the state, nor is the company registered to do business in Minnesota.

Variable Marketing acts a “lead generator” utilizing automatic dialing announcing devices (robo-calls) to connect consumers with a call center, which then connects the consumer to an insurance agent licensed in the consumer’s state, the department said.

It is alleged that Variable Marketing robo-called 38,237 Minnesota residents in an attempt to sell insurance.

Regulators also assert that in addition to engaging in unlicensed activity, the communications to Minnesota consumers regarding the insurance policies were false and misleading because the company represented themselves as acting on behalf of a government agency.

According to the department, the pre-recorded robo-call stated: “This is a public service message regarding information released for drivers licensed by the Department of Motor Vehicles. You are currently overpaying for your auto insurance.

“To utilize this free service and adjust your current insurance rate, or for more information, press 1 now. Press 3 to be removed from this list.”

After pressing “1,” consumers would hear another message about saving “several hundred dollars” on auto or homeowner’s insurance and would then be connected with the Variable Marketing LLC call center, the department said.

“Robo-call solicitations can be annoying but these are actually deceptive, misleading Minnesotans to believe that they are providing information from the government when it is really an insurance sales call,” Commerce Commissioner Mike Rothman said in a statement released by the his office.

The department further charged that once the call center representative collected more information, the consumer was transferred to an insurance agent in Minnesota.

It is alleged that Variable Marketing received money for transferring approximately 316 calls to a State Farm Insurance agent in Cottage Grove, Minn., who sold at least 20 new policies.