California insurance regulators fine Zenefits up to $7 million

Human resources startup Zenefits will pay up to $7 million in penalties under terms of a settlement with California regulators who had accused the San Francisco company of selling insurance policies without the proper licenses.

“Zenefits is an example of an internet-based startup whose former leaders created a culture where important consumer protection laws were broken—a bad strategy that placed the company at risk and that other startups should not follow,” California Insurance Commissioner Dave Jones said in a prepared statement.

Zenefits has settled similar improper-licensing claims with regulators in at least seven other states this year: Arizona, Delaware, Minnesota, New Jersey, South Carolina, Tennessee and Washington.

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