Start-up fined for selling insurance without a license

Company self-reported the instances in which it transacted without proper authorization

Start-up fined for selling insurance without a license


By Allie Sanchez

The Iowa Insurance Division penalized San Francisco based YourPeople Inc, which is more popularly known as Zenefits FTW Insurance Services, for undertaking insurance related transactions without a proper license.

Zenefits was slapped with a $26,000 civil penalty for at least 26 instances of selling, soliciting or negotiating insurance without proper Iowa licenses.

“Zenefits self-reported these violations to the Iowa Insurance Division as they also did in other states, but Iowa has laws on the books to protect consumers from unlicensed insurance sales for a reason,” said Iowa Insurance Division spokesman Chance McElhaney in a Business Record report.

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Zenefits automates human resources functions using cloud technology for small and medium enterprises through a subscription-based revenue model.

Since its founding the company has been fined millions, among them a $7 million penalty waiting in California also for selling insurance without licenses and circumventing education regulations late last year.

The company has had to face similar scenarios in the states where it has started operations since its founding.

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