Each year, Wolters Kluwer Financial Services editors review and analyze results from state market conduct exams. As part of the review process, they track market conduct issues by line of business. This year, their reviews indicated that five of the top 10 market conduct issues raised in property and casualty lines in 2009 were claim-related. To find out why, Claims' Eric Gilkey spoke with Kathy Donovan, senior compliance counsel, insurance, at Wolters Kluwer Financial Services.

Why does your annual always include so many claim-related conduct issues?

Claim-related issues have a definite recurring presence in our annual reports of market conduct issues. Insurers are required to perform many detailed, time-sensitive steps during the claim process, from acknowledging the claim and providing required forms and disclosures, all the way to final payment and file documentation. Each step in each state, multiplied by the sheer claim volume processed by property and casualty insurers, can easily become missed compliance opportunities. These "possibilities for noncompliance" frequently become the reality we see annually in market conduct exam findings.