Bob Graham, Executive Editor

Insurance like life can be ironic sometimes.

Liberty Mutual recently earned a $25,000 fine from Maryland Insurance Commissioner Ralph S. Tyler for failing to give proper notice of a proposed rate increase, according to an article at IFAwebnews.com. The property-casualty insurer had a computer problem that caused the problems.

The insurer isn’t alone. Its regulator in Maryland, the Maryland Insurance Administration, had some computer system problems of its own last year. For several days in February 2007, the MIA Web site wouldn’t allow producers to process their licenses, causing problems to agents seeking to apply for new or renewal licenses. The MIA fixed the problem, but didn’t incur any penalty, even though Maryland insurance agents were obviously inconvenienced.

As the insurance industry continues to increase its reliance on technology as a means to cut costs, computer problems are likely to occur - for insurance companies and regulators.