Department of Insurance issues Cease and Desist order against Lake Forest unlicensed agent
News: 2020 Press Release
ORANGE, Calif. — The California Department of Insurance issued a Cease and Desist order against Karen Marie Dondanville, 52, of Lake Forest, doing business as Broadstreet Insurance Services (Broadstreet) for allegedly transacting insurance without a license, collecting premiums and failing to place insurance coverage for her customers, resulting in more than $100,000 in uncovered losses to customers. This is the second Cease and Desist order issued to Dondanville and Broadstreet this year to cease transacting insurance.
“Agents that are not properly licensed to sell insurance in California place consumers, their property and their finances at risk,” said Insurance Commissioner Ricardo Lara. “I urge Californians to do their homework when working with a new agent and check their license status.”
The Department received a complaint from a consumer who purchased insurance from Dondanville through their mortgage company, not knowing that Dondanville’s insurance license had been revoked by the Department on November 6, 2019. The consumer received proof of insurance from Dondanville; however, the consumer experienced a loss and discovered the proof of insurance was fraudulent and Dondanville had never placed coverage for their property. The consumer experienced approximately $100,000 in uncovered losses as a result of Dondanville’s actions where she accepted insurance premiums, but failed to place the coverage. On March 25, 2020, the Department issued the first Cease and Desist order, requiring Dondaville to stop selling insurance in the state of California.
The Department’s investigation revealed that another consumer had a similar experience where they purchased insurance from Dondanville through their mortgage company after Dondanville’s license was revoked. The consumer received a quote from Dondanville, paid for the annual policy in full, and received proof of insurance; however, it was discovered that the proof of insurance Dondanville provided to the consumer was fraudulent and the listed insurance company never insured the consumer’s property.
Investigators believe other California consumers may have also purchased insurance from Dondanville, doing business as Broadstreet, and may be at risk for potential uncovered losses. The Department urges financial institutions, mortgage companies, and consumers who have received certificates of insurance from Dondanville and/or Broadstreet to directly contact the named insurer on their policy to verify it is valid. Anyone with additional information or questions regarding this investigation can contact the Department at (714) 712-7660.
The Department issued an Amended Cease and Desist order against Dondanville ordering her to immediately stop selling insurance and representing herself as a licensed insurance agent. The penalty for offering or selling insurance without a valid license is punishable by a fine not to exceed $50,000, and Dondanville may be required to pay up to $10,000 for each act.
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- Cease and Desist Order
- People can check the license status of their agent or contact the Department of Insurance at 800-927-4357 if they suspect they are victims of insurance fraud.
Led by Insurance Commissioner Ricardo Lara, the California Department of Insurance is the consumer protection agency for the nation's largest insurance marketplace and safeguards all of the state’s consumers by fairly regulating the insurance industry. Under the Commissioner’s direction, the Department uses its authority to protect Californians from insurance rates that are excessive, inadequate, or unfairly discriminatory, oversee insurer solvency to pay claims, set standards for agents and broker licensing, perform market conduct reviews of insurance companies, resolve consumer complaints, and investigate and prosecute insurance fraud. Consumers are urged to call 1-800-927-4357 with any questions or contact us at www.insurance.ca.gov via webform or online chat. Non-media inquiries should be directed to the Consumer Hotline at 800-927-4357. Teletypewriter (TTY), please dial 800-482-4833.