A California regulator is taking the unprecedented step of ordering a UnitedHealth Group subsidiary to keep $120 million in profits in the state to help pay up to $1 billion in possible fines for mishandling claims of policyholders.
In an administrative order issued Monday, California Insurance Commissioner Steve Poizner says PacifiCare Life and Health Insurance should not send its dividends to its Minnetonka based parent company.
The insurer faces nearly $1 billion in fines for almost 1 million alleged violations.
Similar informal warnings have been issued in the past, but this is the first time a formal order to keep dividends has been issued.
PacifiCare spokeswoman Cheryl Randolph says the insurer disagrees with the move and is weighing its next steps.
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