All But A Few Local Brooke Insurance Agencies Close

Sacramento Business Journal:

At least two dozen local insurance offices have been shuttered and some franchisees financially ruined amid investigations and lawsuits against a national franchiser that grew rapidly but now is teetering.

Ninety percent of the roughly 30 local offices of Brooke Corp. have been wiped out in the turmoil, which escalated last month when Brooke failed to pay commissions to franchisees or rent to landlords. At the same time, Brooke left the offices on the hook for franchise loans.

The Kansas-based franchiser also appeared to leave some policyholders without coverage when it held onto premium payments instead of forwarding the money to insurers. The Kansas Insurance Department said last week that customers who paid premiums to Brooke agencies would be considered to have coverage.

The California Department of Insurance wouldn’t confirm or deny whether it was investigating Brooke. At least one local agent said he has reported problems with the company to California insurance regulators. Read more.

Photo: Dennis McCoy | Sacramento Business Journal.

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