The Louisiana Department of Insurance on Jan. 7 issued a cease and desist order, notice of revocation, and a fine to an East Baton Rouge Parish insurance producer for alleged misappropriation of premium funds.
Trampus Scott Wagoner, a property and casualty producer, licensed since Dec. 11, 2008, and owner of Armor Insurance, LLC, licensed since July 17, 2009, allegedly misappropriated insurance premium on more than one occasion. According to investigators, Wagoner accepted premium payments from multiple clients but failed to remit their premiums to an insurance carrier, resulting in no policies or inadequate policies being issued for his clients.
The cease and desist order describes three such instances in which Wagoner pocketed the premium, and the property sustained damage from Hurricane Ida.
In the first instance, Wagner pocketed the premium which totaled $1,227.83 consisting of two partial payments to Armor using debit/credit cards, according to the C&D order. Wagoner represented to the customer, L.W., that she was insured by Lloyd’s of London, and that the policy was effective March 10, 2021, to March 10, 2022.
L.W. contacted Wagoner to report Hurricane Ida damage, and Wagoner went to L.W.’s home on Sept. 9, 2021 to inspect the damage. Wagoner paid $800 to have the property’s roof tarped and helped the customer list the damages and research the cost of repairs and replacement. Wagoner came up with a total labor and materials cost of $6,275.26. After applying a deductible of $5,000 that the policy would have had if it had been issued, Wagoner paid L.W. $1,275.26 on Sept. 20, 2021, and documented same on Oct. 13, 2021, in a letter.
L.W. filed a consumer complaint with LDI on Oct. 15, 2021, claiming that Wagoner would not give her documentation of the damages for her application to FEMA for help with repairs.
L.W. believed she had a policy because she had a policy number on the certificate of insurance that Wagoner had issued, which informed L.W. that she had a $5,000 deductible on her policy.
In the second instance, O.P. made two payments, one in March and the other in May, which together totaled $1,225.50, and was issued a certificate of insurance with a policy number showing she was insured by Certain Underwriters at Lloyd’s of London and that the policy was effective from March 11, 2021, to March 11, 2022.
When O.P. reported Hurricane Ida damage, Wagoner told her to apply for assistance with FEMA and let FEMA know she did not have insurance.
On Sept. 9, 2021, Wagoner went to O.P.’s home to inspect the damage. During the visit, Wagoner advised O.P. to put a tarp on her roof, whereupon, O.P. told Wagoner she could not afford a tarp.
Wagoner decided to take care of O.P.’s damages “within the terms and conditions” of the policy she purchased but was never issued. Wagoner paid $800 to have the roof tarped, listed the damage and researched the cost, coming up with labor and materials cost of $6,151.30. After applying the $5,000 deductible, Wagoner paid O.P. $1,151.30 on Sept. 20, 2021.
O.P. filed a consumer complaint with LDI on Oct. 12, 2021, claiming Wagoner came to her home as an adjuster and did not give her documentation of the damages so she could apply for FEMA assistance.
In the third instance described in the C&D, Wagoner emailed on May 25, 2021, a quote to J.K. The quote was for $1,309.59, the annual premium on a Lloyd’s dwelling policy which included coverage for wind and hail. Wagoner submitted the policy application to RPS the same day; However wind and hail were excluded, and the total premium was decreased to $570.39.
Investigators say that Wagoner admitted he never met J.K. and electronically signed the application himself. Wagoner emailed policy documents and a certificate of insurance to J.K. The certificate did not have a deductible listed for wind and hail, according to the C&D. RPS invoiced Wagoner for $524.99 ($570.39, less Wagoner’s commission of $45.40). Wagoner paid the invoiced amount on May 25, and J.K. paid Armor $1,409.59 the next day.
J.K. sustained damage from Hurricane Ida and contacted Wagoner on Sept. 9 to report the damage. After giving J.K. the wrong insurer contact information, J.K. called Wagoner again, and Wagoner told J.K. that his policy was through Lloyd’s and likely did not have wind and hail coverage. Wagoner did not return subsequent telephone calls from J.K., so J.K. filed a consumer complaint with LDI on Sept. 15, 2021, complaining that he was quoted and purchased a policy with wind and hail coverage, but Wagoner got him a policy that did not include wind and hail coverage.
“Louisiana citizens put great trust in their insurance agents and deserve to have that trust honored,” said Insurance Commissioner Jim Donelon. “In this situation, it is especially egregious that these would-be policyholders did not find out about this fraud until they had claims from Hurricane Ida that they were unable to receive payment for. This sort of behavior will not be tolerated in the Louisiana insurance market.”
Wagoner and Armor had 30 days from the time of service to request an administrative appeal or the C&D, license revocation and $7,500 fine will become final.
Individuals or businesses with information regarding this case or others are encouraged to report these matters to the LDI Division of Fraud and Enforcement by calling (225) 342-4956 or 1-800-259-5300