A US insurance brokerage owner and his wife have been jailed after admitting a $1.3 million scam diverting clients’ premium payments for personal use, leaving some without cover.

Brendan and Lisa Lawler were each sentenced to eight months in prison by a Massachusetts court for conspiracy to commit wire fraud.

Authorities say the fraud affected at least 50 individuals and insurance providers and resulted in losses of more than $US962,000 ($1.37 million).

The couple operated BL Insurance Brokerage in New Bedford, Massachusetts. They collected premium payments from clients between March 2023 and March 2024 but failed to pass the money to insurers, according to the US Attorney’s Office.

They used the funds for personal expenses and to keep the brokerage operating.

The Lawlers used premium payments from new clients to pay outstanding amounts owed on behalf of others, effectively operating a Ponzi-style scheme to delay detection.

The brokerage distributed insurance documents that falsely indicated clients had valid cover.

The couple were also sentenced to three years of “supervised release” and ordered to pay restitution, with the amount to be determined.