Two Sandoval County self-storage facilities accused of insurance fraud

  • Each company paid $60,000 — a $50,000 administrative penalty, plus a $10,000 penalty for violating the Insurance License Act


Two Sandoval County self-storage facilities found themselves in hot water for allegedly selling unapproved insurance products and committing unfair insurance practices by charging customers for agreements they did not agree to purchase.

The New Mexico Office of Superintendent of Insurance found more than 1,300 Self-Storage Insurance License Act violations involving Northern Boulevard Storage in Rio Rancho and 528 Armor Storage in Bernalillo.

According to a press release on Wednesday, OSI found that Northern Boulevard Storage and 528 Armor Storage tried to evade state insurance licensing requirements by claiming that their Customer Storage Protection Agreement was not an insurance product.

“The OSI takes consumer protection very seriously and will take aggressive action to protect consumers against businesses who fail to comply with the state’s insurance laws,” OSI Superintendent Russell Toal said in the release.

528 Armor Storage at 1340 Calle de las Lomas in Bernalillo. (Matt Hollinshead/Observer)

According to documents filed March 11, Toal determined that the two companies’ liability disclaimer imposing an insurance requirement and prohibiting an insurer’s subrogation rights was “potentially unenforceable,” and that it was “unfair or deceptive” for the companies to induce the consumer into buying insurance.

Toal also determined that the two storage facilities’ statements on rental agreements being “bargained-for” was “unfair and deceptive,” and there’s no contractual provision for “force placed” insurance offered.

Northern Boulevard Storage is at 3301 Northern Boulevard in Rio Rancho, and 528 Armor Storage is at 1340 Calle De Las Lomas in Bernalillo.

Both companies were hit with hundreds of violations pertaining to the Self-Service Storage Insurance License Act, as well as acting as unauthorized insurers. They were ordered to pay tens of thousands of dollars in administrative penalties within 30 days after a cease and desist order was issued.

Both companies chose to pay those penalties within the 30-day period — a combined $120,000. Each company paid $60,000 — a $50,000 administrative penalty, plus a $10,000 penalty for violating the Insurance License Act.

Northern Boulevard Storage at 3301 Northern Boulevard in Rio Rancho. (Matt Hollinshead/Observer)

Zaiere Hill, property manager at Northern Boulevard Storage, told the Observer his understanding of the matter was that the company didn’t do its research with the protection plan, and Northern Boulevard Storage has been instructed to not charge people for that protection plan.

He also said if a customer does get charged a protection plan fee through auto-pay or some other mistake, they’re supposed to get a credit.

“It’s part of the law or whatnot, at least that’s what they tell us. Every time I do take payments, I make sure I don’t add the protection plan,” he said.

Multiple phone calls made to 528 Armor Storage went straight to voicemail.

The release said consumers who are concerned about whether a self-storage facility is licensed or want to file a complaint about a facility’s insurance fees or licensure can visit or call (505)827-4601 for assistance.