California Authority Prohibits Insurance Firm's Operations
Innovative Partners Faces Cease and Desist Order for Unauthorized Insurance Activities
The California Department of Insurance (CDI) has issued a Cease and Desist Order against Innovative Partners, LP for illegally acting as an insurance company and providing health coverage without proper certification. The company sold unauthorized health plans disguised as single-employer group coverage, but lacked the required licensing to operate as an insurer in California.
The enforcement action aims to protect consumers from unregulated insurance products that may not meet financial solvency, coverage, or consumer protection standards mandated by California law. The consequences generally include immediate cessation of all insurance-related activities in the state, potential fines or penalties, possible civil or criminal liability, and reputational damage.
The consumer was left with unpaid medical bills totaling over $1,700 after Innovative Partners failed to pay for his mental health treatments. Many victims believed they were purchasing Covered California or Blue Shield or Aetna policies from Innovative Partners, but the coverage was found to be limited or non-existent.
Meanwhile, the California Department of Insurance is also formally investigating State Farm's handling of thousands of insurance claims from wildfire survivors affected by the Palisades and Eaton wildfires. The investigation is focused on the Palisades and Eaton wildfires, and the reasons for the rate rise for State Farm in California include increasing market valuations on homes.
Insurance Commissioner Ricardo Lara is enforcing a new insurance pricing regulation in California that recognizes and rewards wildfire safety and mitigation efforts made by homeowners and businesses. Commissioner Lara issued the Cease and Desist Order against Innovative Partners, LP and stated that selling insurance without proper licensing or certification is against the law and puts consumers' health and financial well-being at risk.
The California Department also issued 10 additional Cease and Desist Orders on multiple entities and individuals aiding and abetting Innovative Partners, LP in these fraudulent activities. The cost of recent wildfires in California has been costly for insurers, and the cost of wildfire insurance in California is being attempted to be controlled by regulators. However, the increase in premiums for property insurance in California faces resistance from the regulator.
Consumers were given plan cards with Innovative Partners branding, and these cards often listed PHCS and Group Resources as claim handlers. Some plan cards also listed portal information for First Health Network and/or Marpai Administrators LLC, while others included Teladoc Health Inc. contact information. This marks a serious blow to Innovative Partners, LP, and the consequences they face under California law are designed to protect consumers from unlicensed insurance operations.
[1] California Department of Insurance. (2025, July). Innovative Partners, LP - Cease and Desist Order. Retrieved from https://www.insurance.ca.gov/0100-licensing/0400-actions-against-licensees/orders-and-settlements/
[2] California Department of Insurance. (n.d.). Market Conduct Examination. Retrieved from https://www.insurance.ca.gov/0100-licensing/0400-actions-against-licensees/market-conduct-examinations/
- The lack of property insurance regulation by Innovative Partners, LP led to unpaid medical claims and financial risk for several consumers, as seen in the case of a mental health treatment bill totaling over $1,700.
- The California Department of Insurance is examining State Farm's claims handling process following thousands of insurance claims from wildfire survivors due to concerns about the Palisades and Eaton wildfires.
- Commissioner Ricardo Lara, concerned about the rise in property insurance premiums in California, has implemented a regulation that rewards wildfire safety and mitigation efforts made by homeowners and businesses, but faces resistance in controlling the increase in premiums.
