Washington state insurance regulators fined T-Mobile $20,000 after finding that the Bellevue, Wash.-based wireless carrier offered an illegal inducement to purchase insurance.
Under the promotion, called #GetOutOfTheRed, T-Mobile told Verizon customers it would pay off phone loans and early termination fees to those who switched to T-Mobile and paid for its phone insurance coverage. Washington state Insurance Commissioner Mike Kreidler deemed this an illegal inducement to purchase insurance, according to a statement. State law prohibits insurance providers from offering prizes or other consideration worth more than $100 per consumer per year as an inducement to sign up for insurance.
According to the insurance commissioner, 927 Washington consumers purchased the $15/month plan, called Premium Device Protection Plus, from May 31 to Aug. 2, 2017. The consent order signed by T-Mobile contains no admission of wrongdoing. T-Mobile agreed to pay the fine in July. We’ve contacted the company for comment.
T-Mobile was fined $40 million in April after an FCC investigation revealed the company played a fake ring tone on calls to rural areas with poor reception.
T-Mobile topped 75 million customers for the first time this year as it waits for regulatory approval of the company’s pending $26 billion merger with Sprint.